Question

If your client is uncomfortable with their potential contractor's ability to perform the construction job, what type of bond would you suggest requiring of the contractor?

Answer

Surety bonds guarantee the contractor's performance. These bonds are typically required on all public work but are also available for other project types. By requiring this bond, the owner is displacing much of their financial risk onto the surety company if the contractor fails to perform. The cost of the bond will be included in the contractor's bid and in this way is passed along to the owner.