Bonds are guarantees by insurance companies attesting to the credibility of an individual or a company. There are
basically two types of bonds commonly available in the market, which are the Performance Bonds and the Advance
Payment Bonds.
Performance Bonds: A Performance bond is a guarantee from an insurance company that in the event that a contract is
not executed as demanded by the principal, any shortfall will be met by the insurance company who wrote the bond on
behalf of the contractor.
Advance Payment Bonds: This type of bond issued by an insurer guarantees that in the event that any advance
payment to a contractor in executing a contract is made away with or utilized contrary to the requirements of the
principal, such a default will be met by the insurance company

Premium Rate: 1% (Minimum)