Welcome to Pinnacle Surety, where site improvement bonds are just one of many bond types we offer for contractors. In this article, we’re going to discuss what site improvement bonds are, their benefits and uses. We are also going to talk you through the different types of site improvement bonds that are available to you!
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What Are Site Improvement Bonds?
Site improvement bonds, also know as subdivision improvement bonds, are the bonds that are required by developers, builders and individuals to ensure that a project is completed successfully. These bonds apply to construction projects, public works and any updates that are needed for structures that are already erected and are performed by Subdivision Bond Underwriters.
Site improvement bonds are a requirement for any improvements due to be done on existing sites, and they are a requirement as a condition for getting a construction permit. There is a lot of information out there on-site improvement surety bonds, and we have the low down to help you understand it all. It’s first important to know that site improvement bonds are very different from the usual contract bonds that are used on construction sites. The biggest difference with site improvement bonds is that the owner has to pay the cost of building and not the public agency.
If a general contractor chooses to post the site improvement bond on the owner’s behalf, it’s important to remember that the owner is paying the costs. Usually, the contractor has the right to stop work if an owner doesn’t pay, but if the contractor is posting improvement bonds in the favor of the public agency, the contractor has to finish the job and pay the bills – whether they’ve been paid or not.
Three Entities – One Bond
The site improvement bonds that are issued will bind three different entities together:
- The Obligee – the owner requiring the bond
- The Principal – the contractor who purchases the bond to ensure improvements will be made
- The Surety – the underwriter who issues the bond and guaranteeing that those improvements can be made.
Why Is A Site Bond Required?
Project owners who value protection need to get subdivision bonds. They are bought to protect them from contract default and any other issues that can arrive during a construction project. If there is a chance that the contractor is to be found in breach of contract, a claim will be made on the bond and this reimburses the project owner. If there are any claims made, the surety claims department works hard to resolve the issues proactively with the project. When no solution is found, this is when the project owner is properly reimbursed.
The contractor will have to pay the bond whether they have been paid or not for the job. With the help of Pinnacle Surety, you can get the site improvement bonds you need.
Different Types Of Contract Bonds Pinnacle Surety Offers
When you speak to Pinnacle Surety, you will get a quote for a range of different contract bonds. It’s so important that before your project goes ahead, you familiarize yourself with the various bonds so that you can choose the right ones that you need for your case. Below, you’ll find the four main types of bonds that Pinnacle Surety offers.
When the project owners and contractors start the bidding process, a bid bond plays an important role! If you want to bid on the job, you need a bid bond and it will guarantee that the bidder will agree to the contract if given the project. A bid bond ensures that the project also has sufficient funds available to push the contract through. This can be a great option for a safety net for the project – and this means that contractors have to be interested in the job.
Payment bonds are vital for those in the contracting and construction industries. It acts as a guarantee for suppliers and employees as well as subcontractors to protect them against a lack of payment. Payment bonds form the three-way agreements between contractor, owner and surety bond to ensure that everyone is paid correctly on project completion.
These bonds are a reassurance that projects will be properly completed in the way in which you expect. If someone is hired as a contractor to complete the job, it’s a good thing to have a performance bond. Performance and payment bonds often look similar, which is why they are important to differentiate. Both bonds are highly essential when it comes to project completion, and a performance bond makes sure that the contract owner is protected if the project defaults.
Contact Us Today
It’s important to apply for the bond that suits your needs. With Pinnacle Surety, you can identify which bond matters the most to you and that will suit what you need. We are a professional surety bond agency, and we are wholly committed to ensuring that our clients feel valued. With our help, you can find a trustworthy option for your bonds. We are not like other multi-line agencies; we will only ever focus on surety bonds and it’s our biggest priority that you will only ever get the bonds that you need.
Give us a call today and one of our team will be more than happy to walk you through our service and give you the help you need.