Protect yourself against loss from doing business with a company thats unable to fulfill their end of the bargain. In a nutshell, heres some info on bonds.
A contract bond is a guarantee that the terms of a contract are fulfilled12. It is a contractual guarantee given by the party accepting a contract, which protects the party offering the contract2. The financial backing for a bond is provided by an insurance company specializing in underwriting contract bonds2. There are two main types of contract bonds – performance bonds and payment bonds2. If the contracted party fails to fulfill its duties according to the agreed upon terms, the contract “owner” can claim against the bond to recover financial losses or a stated default provision1.