Performance bond costs typically range from 1% to 3% of the contract amount, depending on factors such as credit score, business experience, financial strength, and project size. This guide explains how performance bond pricing works, what affects your premium, how contractors qualify, and strategies for obtaining the most competitive rates on public works, commercial, and government construction projects.

Surety bonds can seem confusing, especially if you're applying for a license, bidding on a project, or starting a business. This guide explains how surety bonds work, who they protect, how claims are handled, and how they differ from insurance. You'll also see real-world examples involving auto dealers, contractors, freight brokers, and construction companies to help you understand the bonding process.