Performance Bond/Final Bond

A performance bond is issued by the surety at the request of a contractor (principal) that must provide a performance bond when signing a new job contract with an owner or general contractor (obligee).

The performance bond provides security to the obligee that the job will be completed according to the terms of the contract. The bond guarantees to the obligee that, should the principal fail to perform the contract, then the surety will either complete the contract, pay for the cost of completion in excess of the contract price, or pay the bond penalty.