Contractor bonding
The term ‘contractor bonding’ refers to a type of financial guarantee that contractors provide to clients to ensure the contractor fulfils their contractual obligations, such as completing the work according to the agreed terms, within the specified timeframe, and to the required standards. If the contractor fails to do so, the bond provides financial compensation to the client, allowing them to recover losses or complete the project.
Types of bonds commonly used in the construction industry include:
- Performance bonds, which guarantees the contractor will perform their obligations under the contract. If the contractor fails to meet the terms of the contract, the bond can be used to cover the costs of completing the project.
- Bid bonds, often used in the tendering process to assure the client that the contractor, if awarded the contract, will enter into the agreement and provide the necessary performance bond. If the contractor withdraws or fails to provide the bond, the client can claim compensation.
- Payment bonds, which ensure the contractor will pay subcontractors and other suppliers. If the contractor defaults on these payments, the bond covers the costs, protecting those who are owed money.
- Retention bonds ensure the contractor will address any defects or complete outstanding work during the defects liability period.
- Advance payment bonds guarantee the contractor will use any advance payments appropriately according to the contract.
See also: Bonds in construction contracts.
[edit] Related articles on Designing Buildings
Featured articles and news
Amendment to the GB Energy Bill welcomed by ECA
Move prevents nationally-owned energy company from investing in solar panels produced by modern slavery.
Gregor Harvie argues that AI is state-sanctioned theft of IP.
Heat pumps, vehicle chargers and heating appliances must be sold with smart functionality.
Experimental AI housing target help for councils
Experimental AI could help councils meet housing targets by digitising records.
New-style degrees set for reformed ARB accreditation
Following the ARB Tomorrow's Architects competency outcomes for Architects.
BSRIA Occupant Wellbeing survey BOW
Occupant satisfaction and wellbeing tool inc. physical environment, indoor facilities, functionality and accessibility.
Preserving, waterproofing and decorating buildings.
Many resources for visitors aswell as new features for members.
Using technology to empower communities
The Community data platform; capturing the DNA of a place and fostering participation, for better design.
Heat pump and wind turbine sound calculations for PDRs
MCS publish updated sound calculation standards for permitted development installations.
Homes England creates largest housing-led site in the North
Successful, 34 hectare land acquisition with the residential allocation now completed.
Scottish apprenticeship training proposals
General support although better accountability and transparency is sought.
The history of building regulations
A story of belated action in response to crisis.
Moisture, fire safety and emerging trends in living walls
How wet is your wall?
Current policy explained and newly published consultation by the UK and Welsh Governments.
British architecture 1919–39. Book review.
Conservation of listed prefabs in Moseley.
Energy industry calls for urgent reform.