What a performance bond does
A performance bond is the owner's guarantee that the work will be completed as agreed. It is usually required on public works and is common on larger private jobs, typically paired with a payment bond. If the contractor defaults, the surety ensures completion and then seeks reimbursement from the contractor.
What drives the rate
Performance bond premiums are a percentage of the contract value. The biggest factors:
- Contract size and duration
- Your credit and financial strength
- Your track record on similar work
- Work on hand and remaining capacity
Building capacity for growth
The bigger the job, the more underwriting matters. As a broker we put together a surety program that grows your single-job and aggregate limits over time, and we shop the markets that handle hard-to-place files. Bidding work that is bigger than your current line? That is a conversation worth having early.