What does a subcontractor's bond protect the general contractor from?

A subcontractor's bond is primarily designed to protect the general contractor from the risk of non-performance or payment issues related to the subcontractor’s work. This bond acts as a financial guarantee that the subcontractor will fulfill their contractual obligations, including completing their work on time and paying their laborers and suppliers as required.

If the subcontractor fails to perform their duties or defaults on payment, the bond can provide the general contractor with the financial resources needed to cover any losses incurred from these issues. This ensures that the project can continue smoothly, safeguarding the interests of the general contractor and the overall project timeline.

While labor disputes, material shortages, and post-completion insurance claims are important concerns in construction projects, they do not fall under the protection that a subcontractor's bond specifically offers. The bond focuses on the performance and payment aspects of the subcontractor's obligations, making it a crucial tool for managing financial risk on a construction site.