Bid Bonds

Bid bonds guarantee that a contractor will enter into a contract at the amount bid, and will post the appropriate performance bonds. These bonds are utilized by owners in order to pre-qualify contractors submitting proposals on contracts. It provides financial assurance that the bid has been submitted in good faith and that the contractor will enter into a contract at the bid price. Furthermore, knowing that bonding companies will only write bid bonds for principals they're also willing to write performance bonds for gives obligee's peace of mind.

When is a Bid Bond required? Nearly all public sector jobs (state or local government) and many private ones require the posting of a bid bond or cashiers check at the time the bid is submitted.

Ready to apply for a Bid Bond? Visit our Contract Bond Application Center to get started.

Current Market for Bid Bonds: Towards the beginning of the decade, bonding companies were very eager to offer this type of contract bond, writing them frequently, and at very low rates. As the 21st century has progressed, the surety industry as a whole has returned to more conservative underwriting methods. In recent years, the market for Bid Bonds, and other forms of contract bonds, has remained quite steady and it appears things should stay this way for the foreseeable future.

In an effort to help new, smaller companies get bonded in a more timely fashion, a number of bonding companies have begun writing smaller contract surety bonds, particularly bonds for less than $200,000, after only examining applicants' credit reports. This is a positive turn of events, and certainly eases the approval process for many contractors, because it essentially eliminates close scrutiny of various financial statements, which can be very time-consuming for some start-up companies/businesses. If you want an excellent rate, with as little hassle as possible, our agency should be able to help!