IF you have a business in America today, you need a surety bond. There are different names for surety bonds; performance bonds, contractor bonds, but they all do the same thing. They guarantee the performance of one party to the other. Surety bonds are set up to “make sure” the purchasing party in a contractor relationship, usually. They are made to make sure that the contractor does what he says he will do. The surety bond company extends the amount of money-which is not paid out, but extended like a line of credit-for which the contractor pays a certain amount of interest. This way, the contractor is covered if he screws up. But really, the surety bond covers the client more than the contractor. After all, it is the clients house that the contractor is working on, right?
So, if the contractor messes up, does not finish the job, or just does not live up to the level of the contract, then the surety bond company comes in and finishes the job, or hires another contractor to finish it. Sometimes, the surety bond company will just cut a check to the client. The kicker is, the contractor has to pay all that money back to the surety bond company. This is where surety bonds differ from insurance the most.
Get a surety bond today, and you will find yourself getting more work. Surety bonds help your clients feel more secure.