Project bonds
Maintenance Bonds
Give the owner a warranty backed by a surety. Tell us the project and warranty period and we will get you a quote.
Fast approvals and straightforward guidance.
— Josh A., Los Angeles, CA
A maintenance bond is a surety bond that guarantees a contractor will repair defects in materials or workmanship for a set period after a project is completed. If the contractor does not make the repairs, the surety pays for them, up to the bond amount.
You, the contractor, who promises to correct defects during the warranty period.
The project owner, who is protected against defective work after completion.
The bond company that guarantees the repairs and pays if you do not make them.
What a maintenance bond guarantees
The bond guarantees that if defects appear in the finished work during the warranty period, you will repair them. Covered defects are usually problems with materials, installation, or workmanship, not normal wear.
If you do not respond, the owner can claim against the bond. The surety can arrange the repairs or pay the owner the reasonable cost, up to the bond amount, and then collects from you.
Term and bond amount
The warranty period is set in the contract, most often one or two years starting at final acceptance. The amount is often 10% of the contract price. Some owners require a higher percentage on projects where repair costs could be large.
Maintenance bond vs. performance bond
A performance bond covers finishing the project. A maintenance bond covers the period after it is finished. Many performance bonds include a one-year maintenance period at no extra charge. A separate maintenance bond is used when the owner needs a longer period or a separate instrument.
| Performance bond | Maintenance bond | |
|---|---|---|
| Covers | Completing the project | Fixing defects after completion |
| Typical amount | 100% of contract | 10% of contract |
| Typical period | Through completion | 1 to 2 years after completion |
Where maintenance bonds are common
Municipalities often require them on streets, curbs, drainage, and utilities built by developers. They also appear on public building contracts and any work where the owner wants a guaranteed fix period.
Who needs it
Who needs a maintenance bond
- Contractors on road, paving, utility, and site improvement projects
- Contractors on public buildings where the owner requires a warranty guarantee
- Developers and contractors completing subdivision infrastructure for a municipality
- Contractors whose contract requires a warranty bond after final acceptance
How it works
How to get a maintenance bond
Share the requirement
Send the contract, the warranty period, and the bond form the owner requires.
Check your performance bond
If you are bonding the job, ask whether the first warranty year is already included.
Underwriting review
An underwriter reviews the project and the contractor. Most reviews take one to three business days.
Sign, pay, and receive the bond
Sign the indemnity agreement and pay the premium. The executed bond is delivered for the owner.
Cost
What a maintenance bond costs
Maintenance bonds are usually included with the performance bond, so there is typically no separate charge. The performance bond is generally 3% of the bond amount. Final approval and pricing are subject to underwriting.
What underwriters review
- Bond amount and warranty period
- Project type and repair risk
- Contractor credit and quality history
- Whether the surety also issued the performance bond
What to have ready
- Contract and the owner bond form
- Warranty period and start date
- Company financial statement
- Details of the completed or in-progress work
By state
Maintenance Bond requirements by state
Pick your state for the amounts, thresholds, and agencies that apply.
Related bonds
Performance Bond
Guarantees you will finish the project under the contract terms.
Payment Bond
Guarantees you will pay your subcontractors, laborers, and suppliers.
Bid Bond
Guarantees your bid. If you win and walk away, the owner is paid the difference.
Maintenance Bond questions
What is a maintenance bond?
A maintenance bond guarantees a contractor will repair defects in materials or workmanship for a set period after a project is completed. The surety pays for repairs if the contractor does not make them.
How long does a maintenance bond last?
Most last one to two years from final acceptance of the work. The contract sets the period.
How much does a maintenance bond cost?
Usually nothing extra. Maintenance bonds are normally included with the performance bond, which is generally 3% of the bond amount. Final approval and pricing are subject to underwriting.
How much is a maintenance bond amount?
Often 10% of the contract price. Some owners require a higher percentage.
What defects does a maintenance bond cover?
Defects in materials, installation, and workmanship that appear during the warranty period. Normal wear and owner misuse are not covered.
Is a maintenance bond the same as a warranty bond?
Yes. The terms are used interchangeably, along with defect bond.
Do I still need a maintenance bond if I have a performance bond?
Only if the contract requires it or the owner needs a longer period than your performance bond includes. Ask your surety whether the first year is already covered.