A bid bond is a promise that if you win a job, you will sign the contract and provide the final bonds. It keeps bidding fair and serious.
- Who needs it
- Contractors bidding public and large private jobs
- Typical bond amount
- 5% to 10% of your bid
- What you pay
- Often free or very low cost
- Term
- Until the contract is awarded
- A claim protects
- The project owner during bidding
What is a Bid Bond?
A bid bond protects the project owner during the bidding stage. If you win and then back out, the owner can file a claim. The bond covers the extra cost of going to the next bidder.
It tells the owner you are a real, serious bidder, not someone who will throw in a low number and then walk away.
Who needs a Bid Bond?
Contractors bidding on public projects almost always need a bid bond with their bid. Many private owners ask for one too.
If you plan to bid on government work, expect to provide bid bonds often.
How does a Bid Bond work?
Here is the simple flow:
- The owner asks for a bid bond with your bid, often 5% to 10% of the bid amount.
- Junno Surety issues the bid bond, usually at little or no cost.
- You submit your bid with the bond attached.
- If you win, you sign the contract and provide the performance and payment bonds.
- If you win and back out, the owner can file a claim on the bid bond.
Only bid on jobs you can take, and the bid bond is simply proof you mean business.
How much does a Bid Bond cost?
A bid bond is often free or very low cost when you plan to get your performance and payment bonds from the same agency.
Junno Surety can issue bid bonds quickly so you never miss a bid deadline. We look at the whole package to keep your costs down.
What happens if someone files a claim?
A claim happens only if you win the job and then refuse to sign or cannot provide the final bonds. The owner then moves to the next bidder, and the bid bond covers the price difference. So the best move is to bid carefully.
How to get your Bid Bond from Junno Surety
Junno Surety turns bid bonds around fast, even on tight deadlines. Send us the bid details and your contractor profile, and we will get your bid bond ready in time.
We are a licensed surety bond agency and can often issue your bid bond the same day. Start your free quote → or call (762) 499-0237.
Things to know about a Bid Bond
A bid bond is really a promise to stand behind your number. It tells the owner you did your homework and you will sign the contract if you win. Because of that, the bond company that writes your bid bond is usually the same one that will write your performance and payment bonds. They look at the whole picture before the bid. That is why bid bonds are often free or cheap when the bigger bonds come from the same place. The smart move is to line up your bonding before bid day. Then you can move fast, hit the deadline, and never lose a job over paperwork.
Frequently asked questions
How much does a bid bond cost?
Often nothing or very little, especially when your performance and payment bonds come from the same agency.
What happens if I win but walk away?
The owner can claim on your bid bond to cover the cost of moving to the next bidder. So only bid on jobs you can take.
How fast can I get one?
Usually the same day. Bid deadlines are tight, and Junno Surety works fast.
Do I pay for a bid bond if I lose the bid?
Usually not. Bid bonds are often issued at no cost, especially when your performance and payment bonds will come from the same agency.
How early should I set up my bid bond?
As early as you can. Set up your bonding before the bid deadline so you are ready to submit on time with no last-minute stress.