Policy snapshot
A bond that guarantees the contractor will fix defects or maintenance issues that arise within the defect liability period post-handover.
What is Maintenance Bond?
Maintenance Bonds ensure that contractors fix post-completion defects. If they fail, the project owner can claim losses from the insurer.
What can it cover?
- If the contractor fails to rectify construction defects during the maintenance or defect liability period, the insurer compensates the project owner for repairs. This bond supports long-term quality assurance.
Who should consider it?
- Civil contractors, builders, road contractors, Firms involved in turnkey and design-build-finance-operate projects, Housing or infra companies under RERA compliance.
Key features to understand
- Typically 2–5% of contract value
- Valid for 6–24 months post-completion
- Covers structural flaws, poor workmanship, and failure to respond to repairs
What deserves attention before you buy?
Coverage, exclusions, sub-limits, deductibles, waiting periods, warranties and underwriting can vary between insurers and policy versions. The policy wording and schedule remain the definitive contract. Novo can help you review the relevant terms for your requirement.
Read the wording, not just the brochure
The schedule and policy wording determine the actual contract.
Compare meaningful differences
Look at exclusions, limits, deductibles, conditions and claim requirements—not premium alone.
Think beyond purchase
Servicing and claims-related support can matter as much as placement.