Contractor Glossary Performance Bond

This is the first legal action on the part of the consumer against the contractor. Damage caused to person or property due to negligence of the contractor may be covered by their liability policy. A summons is a notice sent to the contractor that you are suing.

Employees who sustain injuries while working on your property are covered by the workers compensation and industrial insurance policy. The difference between the two entities begins during the pre-qualification process. As a starting point it is always important to distinguish between performance bonds and guarantees. On the other hand a true “on-demand” bond is really a stand alone agreement meaning that a bondsman will pay immediately on the first written call by the beneficiary.

This means that a performance bond may be conditional or unconditional. An alternative to retention is a retention bond, where the client agrees to pay the amounts which would otherwise have been held as retention, but instead a bond is provided to secure the amount that would have been retained.

Claiming Under A Surety Contract Performance Bond | Duration 5 Minutes 43 Seconds

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