Depending on the industry you operate, your business may need to have one or more surety bonds. Construction firms need surety bonds in NJ before starting new projects and for a certain period of time post construction. Make sure your construction company has everything in place before the work starts.
Types of Surety Bonds
Government entities require certain businesses to have surety bonds. Types of surety bonds in NJ that your construction business may be required to obtain:
Maintenance Bond: for a period of time after a project is completed, defective workmanship and materials are covered
Bid Bond: if a bond is awarded and declined, the project developer can claim the difference in bids
Payment Bond: payment guarantee in the event of a company bankruptcy
Performance Bond: project completion according to project guidelines
Labor and Materials Bond: payment guarantee for materials, equipment, services and labor
Reasons to Get a Surety Bond
Construction businesses are often seen as risky businesses. As such, the government requires surety bonds to make sure projects are completed following local licensing laws.
Contact an agent versed in construction surety bonds in NJ to make sure you have the right ones. An agent can explain the details, limitations and cost associated with the various types of surety bonds.