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What is a Supply Bond?
A supply bond is a type of contract bond that guarantees that a supplier will provide all materials, furnishings, and supplies as agreed upon in the initial signed contract. If the supplier fails to provide everything that was agreed upon in the contract, a claim can be made against the bond by the owner of the project. If a claim is filed against the supply bond, the surety will underwrite the purchase of the supplies against the loss. Supply bonds are seen as an insurance policy to cover any loss based on the supplier failing to meet the commitments of the contract. Supply bonds are required by law for public construction projects or by the project owner.
Whether you need a supply bond, contract bond, payment bond, our any other type of contract bond, The Surety Place is here to help you. We have specialty programs that are set in place to help you get any bond you need. When others tell you know, trust in The Surety Place to get you the bond you need.
Supply Bond Requirements
Why are Supply Bonds Needed?Supply bonds are required for public construction projects as means to protect the project owner from contractors who fail to meet supply requirements as promised in the initial bid and signed agreement. This contract bond ensure that project owners will be paid out for any losses based on faulty suppliers.
How hard is it to obtain a supply bond?Every bond will have a specific set of guidelines and standards that need to be met in order to qualify. Talk to your surety to see what specific qualifications are needed for your supply bond. Depending on the cost of the project, your personal credit, and surety bond history, the premium you pay can vary.
What is the role of the surety company?The surety company is basically the middle man between a contractor and the owner of a project. If the contractor performs according to the initial agreement, the surety will not have to get involved aside from underwriting the original supply bond. However, if the contractor fails to supply the required materials and defaults on the contract, the surety will pay the project owner accordingly based on the bond amount claimed.
What happens if a contractor defaults?If a contractor defaults, as stated previously, the surety will pay the owner of the project to help supplement any loss caused by the contractor's inability to meet specified requirements. Once the surety pays the owner of the project, the contractor is then liable to the surety to repay the amount in which was paid out. If the contractor is unable to repay the surety, it can be detrimental to their business and ability to obtain bonds in the future.
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Why Choose The Surety Place
The Surety Place has had one goal in mind since it was founded in 2002, to bring innovation and a high level of service the surety bond industry had yet to see. We have been industry leaders from the start; a people first company that you can trust, offering access to agents, specialty programs, and businesses to achieve the right solution at the right time.
A People First Company
What sets us apart from other sureties is that we establish a relationship with you in order to truly understand your business focus. Whether your company is large or small, your bonds are complicated or simple, we can help you get the bonds you need and grow your company. As small business owners ourselves, we know how hard it can be to get started and grow your business. We are here to help alleviate some of those stresses by getting you the contract bonds needed to bid on larger projects. Your needs as a business owner will be heard, and solutions will be found and implemented.
As one of the only true specialists within the industry we supply access, partnerships, and specialty programs with numerous “A” rated sureties across the nation. The Surety Place is here to help you service all your customs bond needs with no appointments or contracts necessary. Our industry knowledge and expertise coupled with our ever increasing specialty programs, give us the unique ability to write your bonds when no one else can.
The Surety Place can be your bond company for the life of your business. When you put your trust into our team of experts, you and your business will never be let down.