Speaker:
Program:
Building Confidence: Demystifying Payment and Performance Bonds
Date / Time:
November 22, 2024 / 9:30 am CT
Event Type:
Conference
Event Name:
Location:
New Orleans, LA
Registration:
Visit this link to register.
Description:
The Miller Act mandates that construction contractors must post payment and performance bonds to secure a federal project contract. A performance bond ensures the project’s completion as per the contract’s specifications, protecting the government, while a payment bond safeguards subcontractors and suppliers against non-payment by contractors. These bonds must be issued by surety companies that meet the legal and regulatory requirements of the Treasury Department. Each surety company follows its own underwriting process to assess the contractor’s creditworthiness, with many offering programs for small contractors and collaborating with the SBA to provide surety bonds to eligible candidates. Once you obtain the bonds, understanding who is protected, the process for making claims and the implication for contractors is important in managing risk. Questions often arise regarding the extent of the surety’s obligations, defenses to claims and what is covered by the bonds. How claims against these bonds impact the contractor are important to managing risk, and understanding the terms of any guarantee or indemnity agreement executed by the contractor (and, likely, the individuals that own the company) in favor of the surety is central to that analysis.
To effectively protect their business and personal assets, this session will help construction contractors navigate the underwriting process, understand their obligations, and optimize their credit potential.
