For many contractors, surety bonds may seem like an extra source of expense that should be avoided whenever possible. However, there are many ways a contractor can benefit from being willing to purchase a surety bond in NJ, starting with the following three gains.
1. Enhanced Working Opportunities
Many public contracts are only open to bids from contractors with surety bonds. For example, government-financed construction projects worth over $150,000 typically require surety bonds. Some private contracts also require surety bonds. Contractors willing to work with these bonds can gain access to a significantly higher number of work opportunities.
2. Guaranteed Completion
Surety bonds guarantee the completion of the contractor’s work, which is often seen as beneficial for the party paying for the work. However, this feature can also benefit the contractor. If the contractor cannot fulfill the contract for some reason, the surety ensures that the work gets done, protecting the contractor against reputational loss or lawsuits.
3. Release From Obligations
A surety bond in NJ also establishes responsibilities for the party that hires the contractor. If the party fails to pay or otherwise does not fulfill stated obligations, the contractor is freed from liability for completing the work without having to endure a legal battle.
A Valuable Means of Protection
These are just a few reasons that contractors benefit from working with surety bonds. Bonds truly protect every party involved, and a bond from the right insurance company should be reasonably affordable and convenient to obtain. Considering these benefits, contractors have much to gain by being willing to work with surety bonds.