Florida Construction Bond
A construction performance bond is used by businesses and municipalities in Florida to ensure that construction contracts are fulfilled. "Florida construction bonds" are often referred to as "Florida contract bonds," but the terms are interchangeable. To get an understanding of why these types of surety bonds are important, we'll want to dive into the three main types of Florida construction surety bonds. They are:
- Bid bonds, which ensure that a contractor will enter into a contract with the developer if their bid is selected.
- Performance bonds, which guarantee that the contractor will complete the contracted job in a satisfactory way.
- Payment bonds, which ensure that all subcontractors, laborers, and suppliers will be fairly compensated.
These three types of construction bonds are required by many governing entities in Florida to ensure that contractors are doing business in a satisfactory way.
How Does a Florida Construction Bond Work?
The purpose of a Florida construction bond is to hold someone accountable for following all rules and requirements established in a construction contract. Like all surety bond types, construction surety bonds in Florida hold someone accountable by making them liable for any damages they cause. There are three parties involved in the bond agreement:
- Principal – This is the person or company that obtains the surety bond. The principal is obligated to pay for all valid claims filed against the surety bond.
- Obligee – This is the person or company that hires the principal. If the principal violates the terms of the contract, the obligee may file a claim against the surety bond for compensation equal to the financial losses caused.
- Surety – This is the company that issues and underwrites the bond. The surety will pay to settle a claim if the principal can't or won't pay for it themselves. Since the principal has financial liability, however, they must repay the surety the claim amount or else they will lose bond coverage and be at risk of a lawsuit.
Which Florida Construction Bond Do I Need?
The construction contract specifies exactly which Florida construction bonds someone needs to obtain – and provide proof of – before the contract can be finalized. It will specify the type of bonds required, the bid, performance, and other details, as well as minimum coverage amounts the bonds must have. Determining your exact surety bond requirements isn't always easy. Rely on the team at Viking Bond Service for help understanding and meeting Florida construction bond requirements of all kinds.
Why Do I Need a Construction Bond in Florida?
If you're in the construction contractor business, it would be virtually impossible to secure most of the construction jobs in Florida without being properly bonded. You'll often be required to submit bid bonds in order to have your service considered. In addition, performance and payment bonds are required on all federally funded projects of $100,000 or more. For private and public projects alike, construction bonds make it possible for contractors to secure business in Florida.
How Much Do Florida Construction Bonds Cost?
Bond requirements can change depending on which area you're doing business in, and they vary individually between each contract. The cost for taking out a construction bond in Florida is calculated as a percentage of the bond amount, usually between 1% and 5%. Viking Bond Service, Inc. is committed to providing a superior surety service at the lowest possible rates.
How Do I Get a Construction Surety Bond in Florida?
At Viking Bond Service, our surety bond experts are happy to help you with whatever your construction bond needs are. Whether you're looking to bid on projects near the Everglades or in the Florida Panhandle, you can be sure that your surety needs are covered. There are a few items of information which will be required during the application process. These items include:
- The date and bid amount
- Your credit score
- Your company's bonding and business history
For bids that are upwards of $250,000, you'll also have to provide more detailed financial information. Simply call the Construction Bond Department at Viking Bond Service, LLC or start your free quote now.
No matter what your surety bond needs are, the team at Viking Bond Service is committed to providing contractors, project managers, and Florida governing bodies the confidence to invest in local construction.
Get Florida Construction Bonds From Viking Bond Service
The easy way to meet Florida construction surety bond requirements is with the help of Viking Bond Service. Get a bond in under 24 hours by requesting a quote – it's free and comes with no obligation to proceed. Or, receive great information and get answers to your burning questions from our team of bond experts. Contact us or call 1-888-2-SURETY (1-888-278-7389).
Learn about Utility Deposit Bonds. Learn about how they work, why they are used and how to get one if needed. Get a quote here.
If you need a Contractor License Bond Viking can help. The process is simple and easy. We provide great rates and fast service.
Surety bond fraud can be costly for the parties involved. Find out more about the risks of fraudlents bonds and how to prevent them from happening to you.
Need a Motor Vehicle Dealer Bond? Viking provides MVD Bonds nationwide. Great rates and fast quotes. Good and bad credit.
