Subcontract bonds can offer GCs protection in today’s volatile construction market. As prices continue to increase and skilled labor is increasingly hard to find, managing the risks of subcontractor default is more important than ever.

NASBP Producer Communications Toolkit 2.0 offers bond producers multiple resources to highlight the importance of subcontract bonds to your prime contractor clients.

When Should a General Contractor Require Subcontract Bonds?
This article offers some questions that GCs should ask when considering subcontractor risk. It also highlights the importance of subcontractor prequalification, which helps GCs feel confident in their subcontractor choice. There is also a brief review of what happens if a subcontractor defaults.

Subcontract Bonds: Four Times When General Contractors Need Subcontractor Bonds
This article describes four instances when a GC should require a subcontract bond on a project. These include when the work is unique and requires special skills, when the work includes design risks for the GC, when there are concerns about the subcontractor’s financials, and when the GC needs expanded capacity.

Surety Story Video: Hensel Phelps Construction
This video shares a GC’s perspective on the importance of subcontract bonds. The contractor notes that any problem on the project is the GC’s problem; with a subcontract bond, the performance is guaranteed. The GC relies on that to ensure the subcontractor’s work will be completed.

Answers to 32 Questions Public and Private Owners Ask About Contract Bonding
Though directed at project owners, this document includes two questions that speak to the importance of subcontract bonds.

• Question 12 discusses the advantages of subcontract bonds to the owner and GC, including a full-page chart. Subcontract bonds completely transfer the risk of subcontractor default onto the surety.
• Question 20 highlights the indirect benefits to owners (and direct benefits to GCs) of subcontract bonds.

Find these and other resources at the Surety Resources for Contractors section of the Toolkit 2.0. These are just some of the valuable free tips and guidance NASBP bond producers will find to help them promote the surety product to construction project stakeholders, including project owners nasbp.org/guaranteed/owner, lenders nasbp.org/guaranteed/lender, architects nasbp.org/guaranteed/architect, and contractors nasbp.org/guaranteed/contractor. Visit the Toolkit 2.0 to learn more here: nasbp.org/guaranteed. Check out NASBP’s social media post every Friday to stay in the know about the NASBP Toolkit 2.0 Resources. #BeGuaranteedToSucceed #surety.