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 provides financial protection to homeowners if the contractor fails to complete work as agreed or doesn't meet contract obligations.

A bond is essentially a three-party agreement between the contractor, a bonding company, and you as the homeowner. If the contractor doesn't fulfill their contractual obligations - whether that's completing work, paying subcontractors, or fixing defective work - 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.

When you're hiring contractors in Ottawa, you'll typically encounter two types of bonds:

Performance bonds guarantee the contractor will complete your project according to the contract terms. If they abandon the job or fail to meet specifications, you can claim against the bond to hire another contractor to finish the work.

Payment bonds protect against mechanics' liens by ensuring subcontractors and suppliers get paid. This is crucial in Ottawa because unpaid trades can place liens on your property under Ontario's Construction Act, even if you've paid the general contractor.

Verifying Bond Status in Ottawa

Always ask potential contractors for proof of bonding and verify it directly with the bonding company. A legitimate contractor will readily provide their bond certificate and the bonding company's contact information. Be wary of contractors who claim to be bonded but can't provide documentation - this is a red flag.

The bonding amount typically ranges from $10,000 to $100,000 or more, depending on the contractor's capacity and the projects they handle. For major renovations in Ottawa neighborhoods like Kanata, Orleans, or Barrhaven, ensure the bond amount adequately covers your project value.

What Bonding Doesn't Cover

Remember that bonding isn't the same as insurance. It doesn't cover accidents, injuries, or property damage - that's what WSIB coverage and liability insurance handle. You still need to verify your Ottawa contractor has current WSIB clearance (check at wsib.ca/clearances) and adequate liability insurance.

For electrical work, ensure your contractor is ESA-licensed (verify at esasafe.com/contractor-locator), and for gas work, confirm TSSA certification at tssa.org. These licensing requirements are separate from bonding but equally important for Ottawa homeowners.

When reviewing contracts with bonded contractors, the City of Ottawa Building Code Services (613-580-2424) can help you understand permit requirements that should be included in your agreement.