What does it mean when a contractor is bonded?

When a contractor is bonded in Ottawa, it means they have purchased a surety bond that protects you financially if they fail to complete the work according to your contract or if they don't meet legal obligations.

A surety bond is essentially a three-party agreement between the contractor, a bonding company, and you as the homeowner. If the contractor fails to fulfill their contractual obligations, abandons the job, or doesn't pay subcontractors or suppliers, you can make a claim against the bond to recover your losses.

How Bonding Works in Ontario

In Ontario, contractor bonding isn't mandatory for most residential work, but many reputable contractors choose to be bonded as a sign of professionalism and financial stability. The bonding company thoroughly vets the contractor's financial health, work history, and business practices before issuing a bond. This vetting process alone is valuable - it means a third party has determined the contractor is financially stable and reliable.

When you hire a bonded contractor in Ottawa, you're protected up to the bond amount (typically $10,000 to $100,000 or more) if things go wrong. For example, if a contractor takes your deposit and disappears, or if they don't pay their suppliers and liens are placed on your property, you can file a claim with the bonding company.

What to Look for in Ottawa

Ask potential contractors if they're bonded and request proof - they should be able to provide a bond certificate showing the bonding company, bond amount, and expiration date. Verify this information directly with the bonding company listed on the certificate.

Don't confuse bonding with insurance. WSIB coverage (which you can verify at wsib.ca/clearances) protects workers if they're injured on your property, while liability insurance protects against property damage. Bonding specifically protects against the contractor's failure to perform or meet contractual obligations.

Red Flags to Watch For

Be wary of contractors who claim to be bonded but can't provide documentation, or who seem confused about what bonding means. Some contractors may try to pass off their liability insurance as "bonding" - these are completely different protections.

For major renovations in Ottawa (kitchen remodels over $25,000, additions, secondary dwelling units), working with a bonded contractor provides extra peace of mind. While the City of Ottawa doesn't require bonding for building permits (call 613-580-2424 to verify current requirements), it's an additional layer of protection worth considering for significant investments in your home.

Remember that bonding, along with proper licensing verification through ESA (esasafe.com/contractor-locator) for electrical work and TSSA (tssa.org) for gas work, helps ensure you're working with legitimate, accountable professionals.