What is an approved form of security executed by a contractor and surety for the execution of the contract?

The correct answer is a contract bond, as it is specifically designed to secure the obligations of a contractor in fulfilling the terms of a project. A contract bond is an agreement involving both the contractor and the surety, which acts as a guarantee that the contractor will complete the work as stipulated in the contract. If the contractor fails to meet their obligations, the surety will intervene and ensure that the terms of the contract are fulfilled, often by either completing the project or compensating the project owner for any losses incurred.

Performance bonds and bid bonds, while also important in the context of construction, serve different purposes. A performance bond ensures that the contractor will perform their duties according to the contract's specifications, but it is specifically related to performance rather than the broader contractual obligations. A bid bond, on the other hand, is typically submitted with a bid to demonstrate the bidder's commitment and capability to undertake the project if awarded. It provides a safety net for the owner but does not directly relate to the execution of the contract itself.

Insurance bonds are not standard terminology in this context and do not serve the same function as the other bonds mentioned. Thus, a contract bond is the most accurate and appropriate choice, as it encapsulates the security aspect of the entire