Everything You Need To Know About Maintenance Bonds
There are a handful of bonds that Canadian contractors need to become thoroughly familiar with. The majority of these bonds protect the owner from the beginning of the project, until the project’s completion. Of course, there is a singular bond, which is capable of protecting the owner well after the project has come to a conclusion. This is where the maintenance bond comes into the picture. Whether you’re the contractor or the owner, a maintenance bond can be tremendously beneficial and SuretyKings will be able to help you obtain the best bond for your individualistic situation. Below, you’ll learn all about this unique bond.
What Is A Maintenance Bond?
Before going any further, it is pertinent to better familiarize yourself with the maintenance bond. This type of bond behaves in a similar manner to a warranty and protects the owner for a specified period of time, after the project has concluded. Although it is not necessarily an insurance policy, it works in a similar manner and will undeniably provide the owner will an immense amount of reassurance.
What Is Covered?
Now, you should take the time to learn precisely what the maintenance bonds provided by SuretyKings cover. This information will be listed below for your convenience.
- Flaws and defects in the materials
- Problems with the design
- Errors in the workmanship
If problems arise, due to any of these problems, the bond will generally cover them. With the information provided above, you can see that the maintenance bond is definitely geared towards the owner and will further protect their investment.
Benefits For Contractors
Although this bond is considered to be primarily beneficial for the owner, it can also be advantageous for the contractor. This is the case, because incorporating a maintenance bond can usually significantly reduce the bond costs, which are incurred in the warranty period. In simple terms, the cost of the performance bond can usually be reduced dramatically, by obtaining a maintenance bond.
Warranty vs. Maintenance Bond
All consumers rely on manufacture warranties to protect them from monetary loss, if an inexpensive or expensive product fails to perform accordingly. Well, a maintenance bond basically acts in the same manner as a product warranty. Of course, there is a major difference and that is it protects an investor or project owner from financial loss. A construction project can run into a large sum of money, which is why it is so vital to set forth a protection plan.
When investing in an electronic device such as a security camera system, anything can go wrong. While many consumers may not consider the amount paid for this product extremely high, others do, which is why they choose to purchase the extended warranty. The same can be said about a small construction project and why should the project owner be forced to take unnecessary risks? No one should be subjected to any type of monetary loss, whether it is only a few dollars or millions.
Correcting Minor or Major Defects
Just because a contractor completes the construction project in a timely manner, does not mean that there will not be any hidden minor or major defects to correct. The project owner may very well find some type of defect that needs to be repaired and this will fall back onto the contractor. You may find the contractor refusing to stand up to his/her side of the bargain. In this case, the project manner will be able to rely on the surety company to back them up.
Getting Covered Right Now
If you’re ready to further protect your future, it is time to obtain your own bonds! The good news is that you’ve already come to the right place. At SuretyKings, you will be able to find maintenance, bid and performance bonds. Be sure to contact our experts today, so they can assist you with any questions you may have.