A contract is generally acquired through a solicitation process where an individual and entities can bid on a construction or other projects, services or goods. The process could include a bid letting notification, completion of a bid proposal, application to a vendor registry system, and any other requirement. the links provide more details on contract processes.
Contract Surety Bonds are often required by the federal government, local municipalities, counties, universities or private entities. The process generally begins with a bidding process and if awarded the contract, a contract bond or payment and/or performance bond (such as a TDot contract) may be required. Types of contract surety bonds include:
1. Performance Surety Bond: Ensures that a contractor will complete the terms of the contract, including keeping within the project timeline and budget.
2. Payment Surety Bond: Ensures suppliers, subcontractors and laborers are paid.
3. Supply Surety Bond: To supply goods within a specific time as outlined in the contract.
4. Maintenance Surety Bond: A guarantee that materials workmanship for a certain period of time after a project is completed.
5. Proposal Guarantee Surety Bond: Another term for Bid Bond .
6. Bid Bond: A surety prequalifies the contractor bidding on the project. The bond confirms that if the contractor is the low bidder, the surety can issue a payment and or performance bond.
The Small Business Administration has a Bond Guarantee Program assistance for small contractors whom wish to bid on projects.
The premium that you pay for a Tennessee Contract Bond will vary and is dependent on business and personal financial statements, experience, scope of work, the amount of the project and other conditions. Bid bonds are generally issued at no cost.
Contact our Surety Bond Specialists today at:
Hours: 8:00-5:00 CST, Monday through Friday