Contractors - bonding

If an electrical contractor is 'bonded,' it means his or her company is covered by a special type of insurance, designed to protect those who hire them. In a bonded company, individual workers have been investigated. The insurer then extends protection to the homeowner against theft, vandalism or other such damage by the contractor's crew. You may want to verify with the contractor's insurance company that their bonding policy is still in effect. For large contracting jobs, such as commercial projects, a performance bond may be used. The performance bond guarantees that the contractor will perform the work specified, and if he or she does not finish the job, the insurer must pay off. Most performance bonds are written for projects worth $25,000 or more; since residential electrical work rarely reaches that level, this type of bond would not affect the typical homeowner.