You should know what the difference is between insurance and a contractor bond, especially if you are looking to hire a contractors bonding and insurance company. There are different laws that differ from area to area, so ensure that you are aware of what you need to have for your business. Here are just a few of the main differences in these areas to be aware of.
Before you hire any contractors bonding and insurance company you should know what the difference is between the types of coverage that you need. Ask the experts that you are going to hire about the laws in your area so that you can have what you need, including the levels of coverage that are necessary. You would need various types of insurance coverage for your business and your employees, such as:
Workplace violence injuries
Injuries for work-related travel
Injuries during work
Most often these incidents are covered under workers compensation and ensures that the employees rehabilitation, disability income and medical care. The contract bonds are typically considered to be lines of credit and not insurance coverage. This means that the bonds would need to be paid back if they are used and when they are taken out. This includes payment and performance bonds that are paid out initially by the contractors bonding and insurance company
Bonds ensure that the contractor can perform the work up to a certain standard while still maintaining the funds to pay for the various subcontractors, materials, laborers and even supplies. The requested bond would need to be fully inspected by the surety company before anything is paid out and after the project is completed, then the business would be required to give the money back.
There are many differences between insurance and surety bonds that you should know about, especially if you are running a business. The bonds are essentially a line of credit that you would need to pay back to the company. However, insurance is coverage that you don’t need to pay them back for and can cover all types of injuries for your employees as well as other payouts. Make sure that you have both depending on the laws of the area that your business is in so that you can keep your business are fully covered and that you won’t have to pay for any injuries, fatalities or anything else out of your own pocket.