Maintenance Bond Definition

A maintenance bond is a type of bond that is used in the construction industry. Contractors can purchase this type of bond in order to protect themselves against liability after a project is completed. This type of bond is designed to protect the contractor from having to come up with any money after the fact.

Maintenance Bonds

This type of bond is valid for a limited time after a project is complete. The contractor will purchase a bond for a certain amount of money, and it will protect the contractor for a specific time period. If anything goes wrong with the project during that time, the bond company will step in and pay for the problem to be fixed. 

What It Covers

A maintenance bond could protect the contractor from a number of things that could go wrong. If there is some type of defect in a product that the contractor used during construction, the maintenance bond could cover this. The bond can also cover against problems with the workmanship on the project. If you are a contractor working on a big project, this type of bond can significantly lower your overall liability on the project once you are finished.

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