Repairs and remodels can be stressful, so you'll want to know that they're done right. As an owner, a Warranty Bond helps you cut the risk of defective construction by insuring the work performed. You can also benefit from a Warranty Bond since your money will be reimbursed if your contractor goes out of business or can't repair the construction work. A Warranty Bond is a contract between an owner, a contractor, and a surety company. It guarantees that any work defects found in the original construction will be repaired during the warranty period. If the contractor can't fix the defects, the owner will be repaid. Your state or a surety company usually issues Warranty Bonds.

Warranty bond is a guarantee issued by a bank on behalf of the seller which secures any claims by the buyer on the seller due to possible defects in the goods during any agreed warranty period. In building construction business, warranty bond is guarantee for investor, that contractor will solve all warranty issues in warranty time.

Warranty Bond- A warranty bond (also known as a maintenance bond) guarantees for the owner of the

project, that the contractor will solve all warranty issues during the specified warranty period, which is

usually 1 year from completion/acceptance of the project. The warranty period could be longer depending

on the terms of the contract. If contractor is unable to solve the warranty issue or is not in business

during the specified warranty period, the warranty bond provides the owner of the project with a remedy

through the surety to fix the warranty issues.

When requesting a warranty bond on an account that has already been previously submitted to the

surety, among the most important information that needs to be provided to the surety are the

following information:o The Bond Request form - this will provide the surety with a basic overview of the current bond

being requested.o A copy of the complete contract. The contract will verify among other things: that a bond is

required; the penal sum of the warranty bond; the duration of the warranty period; the scope

of work covered with the warranty, etc.o Provide information on how the contract was awarded. Was the contract awarded as part of a

negotiation or was it awarded though a bid process? If the contract was received as part of a

bid process, the surety will inquire as to what security was used to bid the project and want to

know the bid results. The bid results is a tabulation of all bids that were entered for that

contract. If the low bid and the second low bid is different by more than a certain percentage

(most sureties usually has range from 10-20%) they will require an explanation for the

difference.o If the obligee/owner has their own warranty bond form, surety company will want to verify that

the form has acceptable language. If no required form exist, most sureties have their own

generic form.o Provide a list of companies/manufacturers or vendors that can provide the same or

comparable work as specified in the warranty as to provide assurance to the surety that if

contractor defaults, surety can easily find another entity to cover the warranty.

If the surety bond is the first bond being requested on behalf of a new contractor, the following

information should be provided in the submission in addition to the above mentioned items.o Contractor's Questionnaire.

o Business financial statements (balance sheet, income statement, statement of cash flows and

aging schedule for accounts receivable and accounts payable) for the company's last 3 fiscal

year end.o Interim Business Financial Statements.

o Personal Financial Statement for all owners of the company

o Articles of incorporation (if corporation), LLC agreement (if business is a LLC) or partnership

agreement (if business is a partnership).o Bank reference letter and last 3 months most recent business and personal bank statements.

o Resume for all key personnel of the business.

o Copies of all insurance (general liability, professional liability, worker's compensation, etc).

o Current work in progress schedule.

o Copy of the contractor's license and other relevant licenses.

o Copy of the trust f any of the owners of the business have their assets held in that trust.

http://www.knowsuretybonds.com/contract_warranty_bond.html

1. Use the Warranty Bond document if:1. You are a contractor and the project documents or owner requires that you provide a guarantee

regarding the repair of any defects in your work.

2. You are a project Owner who would like a guarantee in the event the Contractor fails to repair any defects in the project.

2. Warranty Bond - Rocket Lawyer https://www.rocketlawyer.com/document/warranty-bond.rl

  Warranty Bond

Guarantees the completed works during the maintenance period, generally one year, against defective workmanship or materials.

What is a Warranty\Maintenance Bond? When requested this bond is usually written for 1 year. Unlike product warranties, this bond simply guarantees the “workmanship” of the contractor for a given period of time. 

What Is A Warranty Surety Bond?

Many surety bonds can be quite confusing at times and Warranty Bonds are no stranger to this fact.

In short a Warranty Bond is a type of contract surety bond that is required by contractors who are

engaged in the execution of a contract. A Warranty Bond acts as a reassurance that the contractor

will fix or repair any warranty issues within the time restraints or deadlines stipulated in the

negotiated and agreed upon contractual deadlines. This will also act as a safeguard against the

problems that will arise in the unfortunate circumstance that said contractual obligations cannot or

will not be met by the contractor.

Why Do I Need A Warranty Surety Bond?

Are you a contractor currently seeking bonding in order to obtain a contract or contracts? Do you

wish or aspire to execute multiple projects in multiple states? If yes was the answer to these

questions then you are most certainly in need of a Warranty Bond. State and local laws require that

a Warranty Bond be filed by the contractor to provide assurances to the project owner that all

warranty related obligations will be met in a timely fashion within the contractual guidelines and

obligations without fail at all times. This will also serve as proof of your compliance and adherence to

the state and local laws and regulations that govern your industry. So if you are a contractor and you

are in need of a Warranty Bond you have certainly come to the right place!

Adding on to a new or existing home is often a risk. Plumbing, electricity and

even general contracting are expensive undertakings and there is a chance

that things may go very wrong if they are done improperly. Understanding

what a warranty bond is and how it can protect you and your major

investment is an important factor in deciding upon a contractor to work on

your property.

1. Functiono A warranty bond ensures that the work done by a contractor is not only to

your satisfaction, but adheres to all state and local codes for the work done. Warranty bonds are usually administered by the state in which a contractor operates. Most reputable contractors will advertise their "licensed and bonded" status.

Benefitso The benefit of a warranty bond is to repay money invested if the work can

not be done within the specified time, or if the company or contractor goes bankrupt. For example, if a bonded plumber's business goes bankrupt while installing plumbing on several houses, the warranty bond repays the money that was invested in a project if it is not completed yet.

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Considerationso Most warranty bonded services are somewhat more pricey than non-bonded

work, particularly because the workmanship is guaranteed. Some contractors may opt to go with unb-onded sub-contractors, especially in large construction projects, but run the risk of the sub-contractor under performing or disappearing with the money paid up-front.

Time Frameo Typically, the lifespan of a warranty bond is one year from the completion of

the work. For homeowners and contractors who hire a bonded workman, this means that they can rely on the contractor to fix any problems that arise without having to pay for additional supplies or labor. Beyond a year, however, it is up to the workman to decide how to handle any needed repairs.

Misconceptionso A warranty bond is no guarantee of flawless performance or trouble-free

operation, but merely an insurance policy against it. Typically, as long as the bonded workman continues to repair any problems for the specified period of time, the homeowner or contractor who hired him or her has no legal recourse unless they can prove gross negligence or fraud in the execution of the work.

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When a client chooses to have contract work on their home or property, they are putting a great deal

of trust into that contractor who will be doing that work. Because there is risk to this, the contractor

should secure a warranty bond. Warranty bonds ensure that clients are able to have peace of mind

in the work that will be done to their property.

A warranty bond serves an important purpose. This type of security bond will indicate to your clients

that you have taken extra steps to prove your trustworthiness. As a contractor, your security bonds

are stating that you have a history of trustworthiness and this is why the state granted you the bond.

Additionally, you are letting the client know that they are not defenseless should the work done on

their property be subpar, dangerous, or unethical in any manner whatsoever.

Warranty bonds are important to the client and the contractor. If you need to apply for one of the

bonds, then the professionals at Ox Bonding can help you.

CARI

I. Contractors All Risk

1. Duly accomplished Sworn Statement of Claim (to be supplied by adjuster)2. Duly accomplished Non-Waiver Agreement (to be supplied by adjuster)3. Incident Report4. Weather and rainfall report from the nearest weather station officially issued by the PAGASA (if

applicable/required)5. Copy of Contract Agreement with Bid Estimates6. Copy of Notice of Award7. Copy of Notice of Commence8. Copies of Business Registration, permit, etc.9. Survey of damages based on standard engineering practices (Plans, survey data, PERT CPM, etc.)

10. Projected Cash Flow of the project11. Detailed computation of loss and damages in order to bring back the damaged portions to its original

condition before the loss12. Certified copies of recent and previous monthly accomplishment/progress report including its back up

computation13. Certified copies of recent and previous billing reports14. Documents in support to the actual cost of repair/replacement of the affected properties such as invoices,

receipts, etc.15. Clear and properly annotated panoramic pictures immediately taken after the loss

 

II. The contractor all risks policy is specially designed to cover for loss or damage to predominantly civil engineering construction projects ranging from small villa to construction of bridges or high rise.

This is an “All Risk” policy covering various activities of construction (except specific exclusions as mentioned in the policy)

This policy can be taken out in the joint names of the contractor and the employer. This policy enables the Contractor or Employer to comply with the insurance requirements of the Contract

III. Cover can be extended to include constructional plant as part of the Contractor All Risks cover

http://www.axa-gulf.com/uae/en/Contractors-All-RisksConstruction All RiskBusinesses that operate in complex industrial sectors require sophisticated risk management solutions for their onshore construction projects. Our Construction All Risk insurance can be customized to combine commercial property and catastrophic cover with other specialty coverages to address the wide-ranging exposures of construction projects.  Drawing on long-term experience and expertise, we marry highly-rated capacity with flexible coverage and expert loss engineering services to protect a project from inception through completion and beyond.Features & Benefits

Available limits among the highest in the industry Flexibility of admitted and non-admitted policy forms available in all 50 U.S. states Global risk transfer solutions can be tailored for accounts of all sizes  Underwriting, engineering, loss control and claims services provided by energy industry specialists

located worldwide More than 30 years of experience as a market leader

Coverage Available limits of up to $250 million Natural catastrophe capacity, including earthquake, flood and windstorm Contractor’s property, including real and personal property, contractor’s equipment and boiler

and machinery Builder’s risk designed for installation coverage for trade and smaller contractors Testing and commissioning  Blended construction and operational programs Delay in start-up (DSU) coverage, including soft costs, debt service and advance loss of profits/rents Transit, ocean cargo and inland marine coverage also available from AIG

Wherever there is the construction of buildings or civil works, there is a risk of loss or damage. The contract governing the works will place the responsibility for this loss or damage with either the Contractor or Employer.

Our Contractors All Risks insurance policy can protect either party against the cost of this loss or damage.

All Risks Key Features

Cover for damage to permanent and temporary works and free issue materials, whilst on site and whilst in transit to and from site.

Cover for owned and hired in plant and machinery.

Up to 12 months cover after completion for contractual obligations forming part of the maintenance or defects liability period.

Cover for any party that is required to be a joint named insured under the contract

Additional cover as standard including Professional fees and Debris Removal. Please refer to the policy wording for a full list of extensions.

Contractors' All Risks Insurance (CAR) - this provides coverage for buildings and civil engineering projects during construction, against accidents resulting in loss, or damage/destruction of materials, work in progress, construction plant and equipment and construction machinery. Construction of condominiums, offices, buildings, hospitals, schools, factories, roads and bridges are just a few examples of where CAR can be applied. The policy protects you against accidents and damage caused by fire, lightning, explosions, earthquakes, landslides, typhoons, floods, short circuit (and other electrical causes), negligence, lack of skill, malicious acts, theft, and burglary.

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