Surety Bonds Texas
Surety Bonds for Texas Contractors and Businesses
Surety bonds guarantee your performance or payment obligations to a project owner, government agency, or licensing authority. Most Texas contractors need a bond to get licensed or bid on public work.
What’s covered
- License and permit bonds — required by Texas licensing boards
- Performance bonds — guarantees project completion per contract
- Payment bonds — guarantees payment to subs and material suppliers
- Bid bonds — required to submit bids on public projects
- Maintenance bonds — guarantees work quality after completion
Best for
- Licensed contractors in Texas requiring a bond to operate
- Businesses bidding on public or government work
- Subcontractors required to provide a bond by a GC
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Tell us what bond you need and we’ll get it moving.
Types of surety bonds for Texas contractors
A surety bond is a three-party agreement — the principal (you), the obligee (the party requiring the bond), and the surety (the bond company). Unlike insurance, a surety bond guarantees your performance or financial obligation. If you fail to deliver, the surety pays the claim and then seeks reimbursement from you.
Required on public and commercial bids. Guarantees that if you win the bid, you’ll enter into the contract and provide the required performance bond. Typically 5–10% of the bid amount.
Guarantees you’ll complete the project per contract terms. Required on most public works and many large commercial projects. Typically 100% of the contract value.
Guarantees that subcontractors, laborers, and material suppliers will be paid. Required alongside performance bonds on most public projects under the Little Miller Act.
Required by the state or municipality to obtain or renew a contractor’s license. Amounts vary by trade and jurisdiction — typically $10,000 to $50,000 in Texas.
Surety bond costs in Texas
Bond premiums are a percentage of the bond amount. Unlike insurance, you’re not buying coverage — you’re paying for the surety’s financial backing. Credit score is the primary pricing factor for most bonds under $500K.
| Bond Type | Typical Rate | Example Premium |
|---|---|---|
| License bond ($25K) | 1% – 3% | $250 – $750/yr |
| Performance bond ($500K project) | 0.5% – 2% | $2,500 – $10,000 |
| Performance bond ($1M project) | 0.5% – 1.5% | $5,000 – $15,000 |
| Bid bond | Often free or minimal | $100 – $500 typically |
Rates depend on credit, financial strength, and project complexity. Larger bonds require full underwriting including financial statements.
Surety bond questions
Is a surety bond the same as insurance?
No. Insurance protects you from losses. A surety bond protects the party requiring it — if a claim is paid, the surety recovers from you. Think of it as a financial guarantee, not a risk transfer.
Do I need good credit to get a bond?
For smaller license bonds, credit score is the primary factor. Good credit (680+) typically gets the best rates. Contractors with lower credit can still get bonded — but at higher rates. For large performance bonds, financial statements and bank references are also reviewed.
How fast can you issue a bond?
Small license bonds can often be issued same day or next day. Larger performance and payment bonds require more underwriting and may take several business days to a week depending on the surety and bond size.
Need a surety bond in Texas?
Tell us the bond type, amount, and when you need it. We’ll get you the right bond through the right surety market.
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