What is a Payment Surety Bond?
A Payment Surety Bond is a requirement on most projects by federal, state, and local municipalities when a construction company wins a public contract. The Payment Surety Bond seeks to ensure that the bonded contractor pays all subcontractors and suppliers within two tiers. This means that the Payment Surety Bond will cover a subcontractor of a subcontractor to the bonded entity but does not offer protection past the second tier subcontractor. If the awarded contractor fails to pay its subcontractors and suppliers, the Payment Surety Bond will provide funds in order to pay the unpaid subcontractors and suppliers within two tiers of the bonded contractor.
What is the current market for a Payment Surety Bond?
Payment Surety Bonds are widely written by multiple surety bond markets. The Payment Surety Bond amount is the total amount of the awarded construction company’s bid with the exception of any other percentage increase or decrease listed within the contract or pre-bid documents.
How do I apply for a Payment Surety Bond?
- Complete our online Payment Surety Bond application, or
- Download and complete our printable Payment Surety Bond application, and
- Receive your surety bond quote in minutes!