A payment bond guarantees that you'll pay your subcontractors, laborers, and material suppliers on a bonded project, and it protects the project owner from liens if you don't. On most public and commercial jobs, the payment bond is issued together with the performance bond — and it's usually included at no additional premium.
Payment bonds are required on virtually all public work (under "Little Miller Act" statutes in each Southeast state) and many large private contracts. They give owners confidence that everyone down the chain gets paid, and they give your subs and suppliers confidence to work with you.
Because the payment bond travels with the performance bond, the underwriting is the same review — one package covers both. See performance bonds →
Frequently asked
What does a payment bond do?
A payment bond guarantees that subcontractors, laborers, and material suppliers are paid on a bonded project, protecting the owner from liens.
Is a payment bond separate from a performance bond?
They are usually issued together on public and commercial jobs, and the payment bond is typically included at no additional premium.
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