Bid Bonds

A bid bond is a type of financial guarantee that a contractor provides when submitting a bid for a project. It assures the project owner that if the contractor wins the bid, they will enter into a contract and provide any required performance bonds. If the contractor fails to do so, the bond covers the owner’s additional costs or losses up to a certain amount. Essentially, it protects the project owner from financial risk if the winning bidder backs out or cannot fulfill the project obligations.