Performance Bonds – ABI, On-Demand & Hybrid Solutions
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Need a Performance Bond?
If your construction contract requires a Performance Bond (also known as a Construction Guarantee Bond), Aedis Surety is here to help. These bonds are typically required to guarantee that the contractor will complete the works as agreed—and are often arranged before any work begins on site.
What is a Performance Bond?
A Performance Bond is a form of Surety Bond—a written guarantee that protects the Employer against losses if the Contractor fails to fulfil their contractual obligations. Typically, it covers 10% of the contract value and ensures the project can be completed or that compensation is available if not.
How Do Performance Bonds Work?
Performance Bonds are issued in favour of the Employer and cover a specific amount, which can be claimed in the event of Contractor default.
These bonds are usually set up at the start of the contract and run until Practical Completion or the Making Good of Defects. Once the end date is reached, the bond expires automatically.
Can I Get a Performance Bond?
Performance Bonds are issued in favour of the Employer and cover a specific amount, which can be claimed in the event of Contractor default.
These bonds are usually set up at the start of the contract and run until Practical Completion or the Making Good of Defects. Once the end date is reached, the bond expires automatically.
How Much Does a Performance Bond Cost?
The cost of a bond varies, depending on factors such as project value, contractor history, and required security. Generally, you can expect to pay between 3% and 10% of the bond value. Some providers use a fixed rate, while others charge annually or apply minimum premiums.
Our team can provide an instant quote—ideal for tender pricing
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Will I Need to Provide Security?
Yes—all performance bonds require some level of security. This typically starts with a Company Indemnity, but depending on the bond size and other factors, the Surety may request additional collateral.
We work hard to negotiate the lowest security requirements, and wherever possible, we help our clients avoid personal guarantees or cash deposits.
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Types of Performance Bonds
ABI Performance Bond
The most commonly requested type, the ABI Performance Bond is widely accepted and used in JCT contracts. It’s a balanced, fair solution that pays out only on quantified losses, offering protection without excessive risk to either party.
On-Demand Performance Bonds
These bonds offer faster access to funds for the Employer and require the Surety to pay upon demand—typically within five working days or less. While Aedis Surety arranges On-Demand Bonds regularly, we ensure our clients understand the increased risk and potential for immediate enforcement of collateral.
Bespoke & Hybrid Bond Wordings
Request a QuoteConstruction bond wordings often vary—especially with NEC contracts or solicitor-altered documents. Aedis Surety supports all types of bond wordings, including:
- Adjudication Bonds
- Hybrid Performance Bonds
- Conditional Performance Bonds
- Bid Bonds (less common in the UK market)
We offer expert guidance if you’re unsure about your bond wording—ensuring you fully understand your obligations.
Why Provide a Performance Bond?
While Performance Bonds are often a tender requirement, many contractors choose to offer them proactively to strengthen their bids.
Providing a bond backed by a respected Surety shows you’re committed, credible, and financially secure—giving Employers confidence in your ability to deliver.
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Why Choose Aedis Surety
At Aedis Surety, we specialise in navigating the complexities of the UK Surety market. Our team has the knowledge, experience, and market access to secure the best terms for your business.
We provide:
Competitive premium
Fast, streamlined process
Access to a wide range of Surety providers
Support for all bond wordings (ABI, On-Demand, Hybrid, Adjudication)
Access to exclusive markets not available to other brokers
In-depth Surety market expertise
How Can Aedis Surety Help?
Whether you’re a Main Contractor or Subcontractor, we can help you obtain the bond you need—quickly and efficiently.
We place bonds through insurance-backed Surety markets rather than traditional bank guarantees, helping you protect banking lines and maintain healthy cash flow.
Use our Performance Bond Calculator or speak to one of our experts today for an instant indication of costs based on your project.