Surety Bonds on Construction Projects

8/24/2016 11:18:13 AM

BondsConstruction contractors have a lot of weight on their shoulders. With each project comes the need for these professionals to provide an exceptional level of service and workmanship. Mistakes can happen. Sometimes, very small mistakes during the construction process can lead to large financial implications for the contractor. And that’s what most customers worry about. How will they be protected if there is a flaw or a problem occurs during the build? With surety bonds, construction contractors can offer a layer of financial security to the customer, allowing them to know that their risks are minimal.

What Happens When a Job Fails?

Surety bonds provide a promise. The company that holds the surety bond promises to pay the customer or to otherwise fix the problem associated with the poor workmanship or mistakes made by the contractor. For example, the construction company maintains surety bonds for their project. When that project fails, such as an employee makes a mistake or there are situations in which the project falls through, the customer is covered. The surety bond provider can step in to make it right. It is that level of financial protection that customers need to know that working with this contractor is a good financial decision for their needs.

It's important to know that defaulting on contracts hurts contractors as well. If a company does this often, it is hard to obtain additional types of business insurance and other bonds. Defaulting on the project is rarely advisable and is never considered good business practice. But surety bonds can be there in those rare situations where it is impossible to actually fix the underlying problem.

Getting Surety Bonds in Place

All construction contractors should have surety bonds for any project they work on. In many cases, this becomes a requirement of working with the company or customer. When these bonds are in place, the company is protected from the covered claims, as is the customer. Of course, these bonds and all business insurance should be customized to best represent the specific needs of the project and the risks it presents. With bonds in place, though, all parties can feel good about moving forward with the project knowing that, even when the contractor fails, protections are available.

Get the protection you need. Call La Familia Insurance at (888) 751-7511 for more information on Dallas surety bonds.

Tags : bonds, surety bonds, dallas, contractors, construction
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