What a bid bond is
A bid bond is a guarantee you submit with your bid. It tells the project owner that if you win, you'll sign the contract at your bid price and provide the performance and payment bonds the contract requires. If you walk away, the surety pays the owner's loss up to the bond amount, and you repay the surety.
In Montana
Montana public bodies must require bid security on public works and other covered contracts, under 18-1-201, MCA. The minimum is 10% of the bid price, and a bid bond from a surety authorized in Montana is accepted.
- For bids to buy public debt, the minimum is 2% of the principal amount, under 18-1-202, MCA.
You need this bond if you're
- A general contractor bidding public works
- A subcontractor whose general contractor asks for bid security
- A contractor bidding a private job where the owner asks for one
- A design-build team bidding a public project
What the surety looks at
Your business details, credit, experience and the job you're bidding. Larger jobs can also need financial statements and a list of work in progress.