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What Is A Payment Bond?
A payment bond ensures that a contractors material suppliers and subs are paid according to contract and is very commonly used on public projects where mechanics liens are not allowed. A payment bond is a type of contract bond that is often packaged with a performance bond by many sureties. The need for a performance bond and payment bond often arises out of a contractor successfully winning a public job opportunity and posting a bid bond in the process.
How Much Does A Payment Bond Cost?
Payment bond costs can vary but are often around 3% of the contract amount assuming the applicant has sound financials. For example, if your bond requirement is for $200,000, then a 3% premium would translate to a $6,000 bond cost. Payment bond costs will depend on several factors including the financial strength, credit score and experience of the contractor requesting the bond.
Getting A Payment Bond Quote
Getting a payment bond quote is simple. Just complete the quote form on this page and a Schaedler Insurance contract bond specialist will follow up with you promptly to provide the appropriate application for your particular bonding needs and answer any questions you may have. In a rush? Call our office now at 1-800-682-1552 and we can expedite your application with our underwriters.