Site Improvement Bond Guide 

Surety bonds are often required to obtain a construction permit for site improvement work in a subdivision. Learn how they work and where to get one in this guide.

What Is a Site Improvement Bond?

A site improvement bond is a type of construction surety bond required by developers to guarantee the successful completion of subdivision work to a public entity. It financially protects public funds and property if a contractor defaults on a site improvement construction project. 

These bonds are required for public improvement projects in a subdivision, such as: 

• Sidewalks and curbs
• Paved roads and streets
• Sewers and storm drains
• Streetlights
• Power lines
• Water mains
• Landscaping

Why Get Your Bond From SuretyBonds.com?

SuretyBonds.com is licensed to issue site improvement bonds in every state. No matter where you work, we can bond you! As the nation’s top surety provider, we offer the best service, fastest delivery and most affordable prices in the industry.

Site Improvement Bonds vs. Subdivision Bonds

These bonds are very similar to subdivision bonds. However, subdivision bonds are for new structures while site improvement bonds are for improvements to existing sites. 

How Does a Site Improvement Surety Bond Work?

Filing a site improvement bond ensures improvements will be made to a subdivision or commercial property according to contractual terms. The surety bond contract binds three entities together:

1. Obligee: The municipal agency requiring the bond
2. Principal: The project owner who purchases the bond and accepts financial liability
3. Surety: The insurance provider that issues the bond and backs the principal

If a contractor breaches the bond terms, the obligee can file a claim. Then, the surety will work to resolve issues. If no solution is found, the surety will reimburse the project owner for losses up to the bond amount and seek reimbursement from the principal.

How Much Does a Site Improvement Bond Cost?

The cost of a site improvement surety bond rate depends on various factors, including:

• The size of the job 
• The bond coverage amount
• The principal contractor’s work history
• The principal contractor’s credit score
• Other financial credentials of the principal contractor

Stronger financial and industry credentials result in a lower bond price. Highly qualified applicants can expect to pay a rate of just 1–3% of the total bond amount for an improvement bond. 

To qualify for our construction bonding program, applicants must have a credit score of 700+.

Get Your Site Improvement Bond Fast

These bonds require a thorough application process, but SuretyBonds.com can issue your site improvement bond in as little as 2–3 days. We even offer overnight shipping to accommodate applicants who are in a rush. Start the process now by applying for a free quote or giving us a call. 

Site Improvement Bonds vs. Construction Bonds

Site improvement bonds differ from typical contract bonds used for construction sites. A key difference is the owner has to pay the cost of building the bonded improvements rather than a public agency. This is also important to remember if a general contractor (GC) agrees to post the site improvement bond on behalf of the owner. 

Normally, the GC has the right to stop work if the owner does not pay him. However, if the GC posts the improvement bonds in favor of the public agency, the contractor is obligated to complete the improvements and pay all bills regardless if the owner paid them.