There are two types of bonds that an estimator must understand. First, there is a bid bond also called a bid security or bid guaranty. Second, there is a performance bond. Let’s take a look at the ...

Bid bonds guarantee that contractors complete projects they bid on, often for public or government jobs. If a contractor fails, a performance bond replaces the bid bond, ensuring project completion.

Surety bonds are an agreement involving a principal, an obligee and a surety company that issues the bond for a fee. In most cases, the obligee accepts a bid or application submitted by the principal.