A performance bond also known as a construction performance bond is a surety bond issued to contractors, that guarantees their performance in accordance with the conditions of their contract and compliance with state regulations for licensed contractors. Performance bonds are required in all states. Allstar Surety can provide both performance and license bonds to ensure your contractor can work on a construction project in the state of which he or she is licensed.
A performance bond works as a form of protection for the project owner, or the state, that has a contract with the contractor. Like all surety bonds– Performance bonds are a type of agreement in which the following three sides are involved: the principal (the licensed and bonded contractor), the obligee (the private or state project owner), and the surety bond company which covers the bond.
Performance bonds are required in all states. Furthermore, before a contractor can work on a construction project, he or she must also be licensed and bonded with a contractor license bond in that state.
Allstar Surety provides performance bonds to contractors of all credit types. Contact a Surety expert today to learn more.