If you are planning to embark on a project in California, whether you are based there or are visiting on business, you need to consider your options in California for contractor bonds. First, let us understand how a ‘contractor bond’ works.

A contractor bond protects you as a project owner from any illegal or unethical conduct by the contractor. The contractor purchases surety bonds before going on with their business to guarantee that your investment goes where it is intended, and in the manner intended. The contactor bonds are basically a guarantee from the issuing bank to protect you as a project owner from any slacking, misallocation of money by the contractor, or incompletion of the project. They are required by the Federal Government for contracts above certain monetary values.

There are three main types of contractor bonds that we can provide you:

1- Performance bonds:

What this bond does is make sure that you get your project completed in accordance with what you agreed on in the contracts. If the contractor does not complete what you agreed upon, you have the right to call on the issuer to do one of two things: either hire a new contractor to finish your project or pay you the costs of hiring a contractor yourself.

2- Bid bonds:

If a contractor bids on your project, and it is assigned to them, if they decide not to honor the bid, the bond gives you the option as an obligee to sue the principal (i.e. the contractor) and the issuer (the insurance company or bank), in order to have the bond enforced. If the contractor refuses to work on the project, they as well as the issuer are legally obliged to cover any extra costs that will occur when you decide to hire a contractor to replace the first one.

3- Payment bonds:

The main beneficiary from this bond are the subcontractors who the contractor hires. If the contractor does not pay them, they can appeal to the issuer to have their payments made. It is also a substitute to the ‘mechanics liens’ in the case of private projects. This bond is usually issued hand in hand with the performance bond.

Why Choose Us?

First things first, you can make confirm the eligibility of the bonds before you have them tied to your contract. This way you can make sure that the whole process is legally sound and that when the need arises, you can rest assured that all the agreements in the contract will be fulfilled. Another very important strength point for our company is that you will receive expert consultancy before any purchases are made. That will guarantee that the bonds purchased are what is exactly right for the intended purpose.

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