To put it simply, surety bonds guarantee that specific tasks are fulfilled. This is achieved by bringing three parties together in a mutual, legally binding contract.
- The principal is the individual or business that purchases the bond to guarantee future work performance.
- The obligee is the entity that requires the bond. Obligees are typically government agencies working to regulate industries and reduce the likelihood of financial loss.
- The surety is the insurance company that backs the bond. The surety provides a line of credit in case the principal fails to fulfill the task.
The obligee can make a claim to recover losses if the principal does fail to fulfill the task. If the claim is valid, the insurance company will pay reparation that cannot exceed the bond amount. The underwriters will then expect the principal to reimburse them for any claims paid.
Why do I need surety insurance?
People often wonder what surety bonds are after they’ve been told they need to buy one.
- Most people need license and permit bonds before they can get their business licenses.
- Construction professionals often need contract bonds before they can work on publicly funded projects.
- Some business owners choose to buy business service bonds to protect clients against employee theft.
These are just a few reasons why you might be looking for information on surety insurance. For more information on a specific bond type please contact one of our surety specialists.
How can I apply?
InsureMart Inc. offers quick and easy bonding services. Unlike other Independent Agents, InsureMart Inc. can get approvals on 99% of applicants regardless of bad credit or other financial problems. All you have to do is call and one of our agents will help you fill out the application. Then we will shop your application around with our exclusive underwriting markets. You’ll receive the lowest available rate. Once you approve the rate and pay your premium, your bond insurance will be legally executed.
Call us at 1866-806-9777 to Get a Free Quote
*Coverages may vary by state and by insured business. Consult your InsureMart Inc. agent about coverages you may need for your unique situation. Coverage descriptions above are for general information only. Actual coverage is subject to all terms, conditions and exclusions of the policy.