A contract surety bond typically costs 0.5%–3% of the contract value in annual premium, with the rate decreasing on tiers as the contract grows. A well-qualified contractor might pay about 1–1.5% on a $1M+ job; weaker credit can push rates toward 3–4%. For example, a $1,000,000 contract commonly costs $10,000–$30,000, and a $2.5M contract can blend to roughly 1.14% (~$28,500) under tiered pricing.
Estimate your premium
What drives your rate
- Years in business and project experience
- Business and personal credit
- Working capital and net worth vs. the size of the bonded job
- The type and risk of the work
Tiered pricing example
2.5% on the first $100K + 1.5% on the next $400K + 1% on the next $2M. The bigger and cleaner your financials, the lower your blended rate.
Frequently asked
How much does a $1 million surety bond cost?
A $1,000,000 contract bond commonly costs $10,000-$30,000 in premium depending on the contractor's financial strength, with lower blended rates on larger contracts.
Are bid bonds expensive?
No - bid bonds are usually issued at no charge as part of setting up the performance and payment bonds.
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