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Payment Bond Calculator

Payment Bond Cost Estimator for Contractors

Calculate payment bond costs using industry-standard sliding scale rates. Rates from 0.5% to 2.5% based on contract size.

Payment Bond Cost Calculator

Payment bond is typically 100% of contract value

Payment Bond Cost Examples

Contract Value
Rate Range
Annual Premium
$100,000
1.0% - 2.5%
$1,000 - $2,500
$500,000
0.8% - 1.9%
$4,000 - $9,500
$1,000,000
0.65% - 1.5%
$6,500 - $15,500
$5,000,000
0.53% - 1.27%
$26,500 - $63,500

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Payment Bond Calculator FAQs

How much does a payment bond cost?

Payment bonds cost 0.5% to 2.5% of contract value depending on project size, contractor qualifications, and credit history. Our payment bond cost calculator uses sliding scale rates - larger projects get lower effective rates. A $1M contract costs approximately $6,500-$15,500 for the payment bond alone.

What is a payment bond?

A payment bond guarantees that a contractor will pay all subcontractors, laborers, and material suppliers working on a project. If the contractor fails to make payments, affected parties can file a claim against the bond to recover what they are owed. The Miller Act requires payment bonds on federal projects over $150,000.

Are payment and performance bonds sold together?

Yes, payment and performance bonds are almost always sold as a combined P&P bond package at a single rate of 1-3% of contract value. Buying them together is more cost-effective than purchasing each separately. Most public construction projects and many private projects require both bonds.

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