Bond Issuance Checklist
One copy of this per bonded job. Print it, staple it to the front of the bid file, and work it in order.
Bonds are late for four reasons: the request went in too late, the owner's bond form contains something the surety will not accept, the job is over the single limit and nobody told the underwriter, or the contract documents were never sent. Every item below exists to prevent one of those.
Job: ______________________ Bid date: ____________ Owner: ______________________
Phase 1 — Before the bid
Read the bond requirements out of the bid documents
Do this when you first read the bid package, not the week of the bid.
- Bid bond percentage — Instructions to Bidders; usually 10%, sometimes 5% or a fixed amount
- Whether performance and payment bonds are required — Instructions to Bidders or General Conditions; almost always on public work
- Whether the owner specifies its own bond form — bid package attachments; this is the single biggest cause of delay
- Warranty or maintenance period — General Conditions, Division 1
- Contract duration — Instructions, or the schedule
- Any design responsibility in your scope — scope, Division 1, performance specs
- Liquidated damages — General Conditions; sureties read these
- Surety qualification requirements — minimum A.M. Best rating, admitted status, T-listing on federal work
- Whether an original wet-signature bond is required, or a PDF is accepted
- Whether a dual obligee rider is required — usually a lender requirement on private work
Flag the three surcharge triggers at estimate time
These three cost extra premium. Price them before you submit, not after you win.
| Trigger | Threshold | Typical effect on premium |
|---|---|---|
| Contract duration | Longer than 24 months | Commonly +25% for 24–36 months, +50% for 36–48 months |
| Warranty / maintenance period | Longer than 12 months | First year normally included; beyond that is extra |
| Design-build | Any design responsibility in your scope | Often around +50%, sometimes a separate sliding scale |
- Duration checked against 24 months
- Warranty period checked against 12 months
- Design responsibility checked
- Premium priced with the bond premium calculator and carried in the bid
These three rows are the ones estimators miss. A 30-month job with a two-year warranty is not priced at the base rate, and you find that out when the invoice arrives rather than when you are still able to do something about it.
Check the job against your capacity
Before your producer has to tell you.
- Estimated contract amount is inside your single job limit
- Current cost to complete backlog plus this job is inside your aggregate limit
- Letter of authority is not expired
- If either limit is a problem, it is stated in the request and your producer has maximum notice
Over-limit requests need two weeks. Inside-limit requests can be same day. There is very little in between. See bonding capacity explained.
Submit the request — target 5 business days out
Minimum 48 hours. Use the bid bond request form.
- Request submitted 5+ business days before the bid date
- Bid documents attached, or at minimum the Instructions to Bidders and General Conditions
- Owner-supplied bond form attached as a PDF — the single most important attachment; the surety's counsel reads it, and that review takes days
- Bid date and time stated
- Estimated bid amount stated
- Anticipated contract duration stated
- Anticipated warranty period stated
- Obligee name copied character for character from the bid documents into the request
Lead time table
| Situation | Lead time needed |
|---|---|
| Bid bond, inside limits, surety's own form | Same day |
| Bid bond, inside limits, owner-supplied form | 2–3 days |
| Bid bond, over single limit | 2 weeks |
| P&P bonds, inside limits, form already reviewed | 1–2 days |
| P&P bonds, owner form not yet reviewed | 3–10 days |
| P&P bonds, over single limit | 2 weeks |
| First bond with a new surety | Weeks |
Phase 2 — Receiving and checking the bond
Run this list on the bid bond when it arrives, and again on the performance and payment bonds before they go to the owner. Do not delegate it to the person who is also assembling the bid package at 4pm.
- Obligee name exactly as the contract documents state it — character for character
- Project name and project number match the documents
- Penal sum correct — bid bond: the required percentage or amount; final bonds: the final contract amount
- Correct bond form used — the owner's if they specified one, otherwise the surety's
- Power of attorney attached
- Power of attorney dated on or before the bond date
- Signed by the attorney-in-fact
- Corporate seal applied
- Notarized, if the form or the jurisdiction requires it
- Signed by you as principal, if the form requires it
- Bond date correct — not after the bid date, not after the contract date
- Original with wet signature if an original is required; otherwise PDF confirmed acceptable
- Number of originals matches what the contract demands — some owners want two or three
Additional items for the final bonds only:
- Both performance and payment bonds present, if both were required
- Contract date and contract identification match the executed contract
- Maintenance bond included, if separately required
- Dual obligee rider attached, if a lender required one
An obligee name that does not match the bid documents exactly can get your bid rejected as non-responsive. "City of Springfield" and "City of Springfield, a municipal corporation" are not always interchangeable.
Checked by: ______________________ Date: ____________
Phase 3 — After award
Send the surety what it needs to issue
Notify your producer the day you are notified, before the contract is even executed. Then send the P&P bond request form with:
- The executed contract — the surety is guaranteeing this document and will not issue against a draft
- Bid results — where you sat against the field; a bid well below the next bidder is a conversation
- Final contract amount — premium is calculated from it
- Schedule and contract duration
- Warranty period
- Owner-supplied bond forms, if not already sent at bid time
- Notice to proceed, when available
Log and distribute
- Bond number logged in the bond register — date, number, surety, obligee, project, type, contract amount, premium, expected completion
| Copy | Goes to | Done |
|---|---|---|
| Original(s) | The owner, per the contract's delivery requirements | [ ] |
| Copy | Back to the surety underwriter | [ ] |
| Copy | Your job file | [ ] |
| Copy | Your central bond register | [ ] |
Money and reconciliation
- Invoice received and scheduled for payment — premium is normally due whether or not the owner has paid you; budget it as a mobilization-period cost
- Premium coded to the job, not to overhead — see what construction bonds actually cost
- Execution report reconciled against your register — check the bond number, the contract amount, the rate tier, and any surcharge; wrong amounts, wrong tiers and double-rated maintenance periods all happen, and nobody catches them except you
- Any discrepancy raised with your producer in writing
Diary the rest of the job
- Projected completion date diarised for closeout — set the reminder now; closeout is what returns your aggregate capacity and triggers any return premium
- Change order log scheduled to go to your producer quarterly — significant change orders may require a bond rider increasing the penal sum, and they always affect final premium
- Bond cost included in your change order pricing
- Consent of surety flagged if the contract requires one for final payment
Ask your producer at what change order threshold this particular obligee will want a rider. It varies by owner and by form, and finding out at final payment is the wrong time.
The one rule that outranks the checklist
If the job starts going badly, your producer hears it from you first. A surety that finds out early has options — funding, a consultant, a payment plan. A surety that finds out from the owner's default notice has one option, and it is the expensive one.
See when a bond claim happens.
Sign-off
| Phase | Owner | Date complete |
|---|---|---|
| Before the bid | ||
| Bond received and checked | ||
| After award: sent, logged, distributed | ||
| Invoice reconciled to execution report | ||
| Closeout reminder set |
Not legal advice. Bond form requirements, notarial rules and statutory bonding thresholds vary by state and by owner, and they change. Verify current law and the specific contract requirements with your surety bond producer and your attorney.
Use with: the full walkthrough at the bond request and issuance process, and bond closeout and final premium when the job finishes.