Supply Bond Guide

Why do you need a supply bond?

You are required to obtain a bond for working on public jobs to protect the public. If you do not deliver the materials and goods according to the contract, a claim can be filed on the bond.

How Do Bid & Performance Bonds Work?

Frequent Questions

We have the standard AIA supply bond forms on file which most obligees use. The obligee may have their own special bond form with their own bond language; in which case you need to obtain it from them.

Yes. We have credit based programs available for smaller contracts which allow new businesses to obtain contract bonding. However, this is not possible for larger contracts unless the owner(s) have substantial equity within the company and an impressive resume of past experience.

No. They specifically exclude the guarantee of any installation. They only guarantee the supply of materials and goods.

Only if you need a standalone supply bond. You do not need a separate application if it is required alongside a performance and payment bond.

To determine your likelihood of triggering claims and your ability to pay them. This is important, as surety bonds are a form of credit to you, not insurance. Sureties will look to you for reimbursement on any legitimate claims.

It is your obligation to provide proof to the surety that the claim is false. It is always a good idea to document any disputes to ensure a proper paper trail to defend your actions.

Surety Bonds do not protect you

The bond is a form of insurance for your clients, which is why many businesses proudly list that they are bonded on their marketing material. However, you will be required to reimburse the bonding company should a claim be paid out.

All You Need To Know About Construction Bond Lines

Fidelity Bonds protect your business

You can protect your business from employee theft and fraud by purchasing a fidelity bond. You can read more in our fidelity bond section.

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What's your bond cost?

Bond costs vary by applicant, bond amount, bond type & the agency you choose. You can get a general idea of costs using our Quick Estimate tool to the right or an exact quote instantly online!

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There are many things you can do to encourage bonding companies to offer you discounted rates. We can advise you on how to maximize your bond lines and minimize your bond costs. Contact us today for a free consultation.

What do bid & performance bonds cost?

How to get discounted contract bond rates