Our Bond Products
Here are a few of the many types of surety bond and fidelity bond products offered by Penn Western Bonding:
Bid Bonds fall into the area of Contract Surety, and bid bonds are the first step in pursuing a bonded construction project. You could consider the bid bond to be the contractor's "ticket to the dance", as the contractor's bid for the project would quickly be disqualified if the bid did not include a properly prepared bid bond. This bond is a financial guarantee to the project's owner that the contractor is bidding for the work in good faith, and the project's owner could make a claim for damages under the bid bond if the contractor refused to stand behind its bonded bid.
These Contract Surety bonds are provided by the contractor to the project's owner after the project has been awarded to the contractor. These bonds provide protections to the project's owner and to the contractor's creditors regarding the ability of the contractor to perform the project and to pay its project costs. The Performance Bond is normally issued in an amount equal to the project's price, and this bond provides the project's owner with remedies in the event that the contractor would default on its performance of the project. The Payment Bond, sometimes called a Labor and Material Bond, is also normally issued in an amount equal to the project's price, and this bond provides the contractor's creditors with possible remedies due to the contractor's failure to pay its costs associated with the project. Normally, the Performance Bond and the Payment Bond are issued togetheras a set, with one premium charge made for this set of bonds.
This Contract Surety bond is provided by the contractor to the project's owner, providing protections to the owner in the event that the contractor would fail to honor its maintenance provisions of the project. The Maintenance Bond is normally issued at the end of the project and is a requirement of the contractor before the project's owner will accept the project as fully completed. This bond is typically provided for a percentage of the project's final price, and the premium charge made for this bond depends on whether a Performance Bond had been issued for the project and on the length of time that this Maintenance Bond would remain in effect.
These Contract Surety bonds are normally provided by the developer to the local municipality as a guarantee that the utilities, streets, sewers and other land improvements of the developed property will be completed to the municipality's satisfaction. These bonds are sometimes called Subdivision Bonds or Completion Bonds. The Developer Bond is normally issued for an amount established by the municipality, based on the estimated value of the work required to make the specific land improvement. This bond provides the municipality with remedies in the event that the developer would default on its obligations under the developer's agreement with the municipality. Since bank financing is commonly involved, it is not unusual for the bonding company to ask the bank to participate in the developer's obligations to the municipality, with the balance of the bank's committed funds flowing to the bonding company in the event of the developer's default.
These bonds are often called Employee Dishonesty bonds and typically will protect the employer against financial loss due to the dishonest acts of one or more of its employees. These bonds can be written in a variety of ways, protecting against the dishonesty of specific employees (identified by name or by title), a certain class of employees (such as cashiers or salespersons), or for all employees of the business. Premiums for these bonds can be charged either annually or on a 3-year prepaid basis, and the premium for a Commercial Crime Bond is determined by the type of industry involved, the number of employees being bonded, and the safeguards used to deter dishonest acts of the firm's employees.