A construction bond, also known as a surety bond or contractor bond, is a type of insurance policy that guarantees the completion of a construction project according to the agreed-upon terms and conditions. It serves as a form of protection for project owners and other stakeholders against potential losses resulting from the contractor's failure to fulfill their contractual obligations. If the contractor fails to complete the project or does not meet the specified quality standards, the bond provides financial compensation to cover the costs of completing the work or addressing any deficiencies. Construction bonds are commonly used in the construction industry to ensure the proper execution of projects and mitigate risks for all parties involved.
Publication date: