Bonding could raise the confidence level an owner has in their contractor. Performance and payment bonds are elements of the real construction agreement with the contractor. The bond guarantees that the contractor will perform the work to conclusion. This will protect the system from any incapability of the contractor to finish the job. This is apparently important. A partially completed work is of little value to an owner. If the contractor fails to complete the work and if the owner files a claim against the bond, the system would get funds to complete the job or the bonding company steps in and finishes the job with another contractor.
The payment bond guarantees the contractor would make all the payments to suppliers for labor, materials and equipments. This gives protection for system from liens filed by subcontractors or suppliers of material. For instance, if the contractor fails to pay any supplier, that supplier could file against the bond and obtain payment provided that the claim is justifiable. This is also an avenue of protection the supplier file a claim against the owner. In these instances the supplier will be referred to the bonding company.