Do you need to get a surety bond but do not know what it is or how it works? Let us help you quickly understand what it is and determine the right one for you.
If you would like to speak to us about how to get a surety bond, you can contact us here.
What Is A Surety Bond?
Essentially, a surety bond is an agreement that guarantees that a company or individual will deliver on its obligations. Simply put, it gives you credibility.
In business, for example, surety bonds show that you are capable of performing the work or services that you are contracting for.
For many industries and professions, surety bonds are required to reduce the risk of the Obligee.
How Do Surety Bonds Work?
A surety bond is created by three parties: The Principal, the Obligee, and the Surety.
1. The Principal – This is the entity that purchases the bond to guarantee the completion of contracted work. This can be a self-employed professional, an independent contractor, a defendant or plaintiff in court, or a small business owner.
2. The Obligee – This is the business or government agency that requires the bond.
3. The Surety – This is the entity that issues the bond and guarantees the Principal’s ability to complete the work.
When a surety bond is made, the Principal purchases the bond, paying a premium. If the Principal does not deliver on their contract obligations, the Obligee can file a claim against the surety bond.
What Is Required For A Surety Bond?
Surety bond requirements differ per state, local laws, type of work, and the type of bond you need. In most cases, you would probably need to show the following:
- Financial capacity
- Credit history
- Company history
- Prior surety bonds
Why Do You Need A Surety Bond?
Government agencies and big companies require a surety bond from companies or individuals to guarantee your capacity to complete the obligation.
Something to note is that many small businesses cannot compete with bigger and more established companies for work because of their financial capacity. Therefore, the Principal can purchase a surety bond that guarantees their capacity to meet contract obligations.
What Types of Surety Bonds Do We Offer?
All N One Bonding and Insurance company specializes in the following types of Surety bonds:
A notary bond is a type of bond that ensures that the notary will fulfill their duties and adhere to the law.
License and Permit Bonds
License and permit bonds are a type of commercial bond that protects consumers by providing them financial protection if a professional or business fails to comply with government rules and regulations.
Lost Instrument Bonds
Lost instrument bonds are a type of bond that guarantees lost or stolen financial instruments, notes, or securities are not fraudulently duplicated.
Janitorial Services Bonds
Janitorial services bonds are a type of bond that protects the Obligee in cases of property theft by any of the company’s employees.
Dishonesty bonds are a type of bond that protects the business from acts such as employee theft or fraud.
What Is The Main Difference Between Surety Bonds And Insurance?
There are numerous differences between surety bonds and insurance, but essentially the main difference is that insurance involves two parties, the policyholder and the insurance provider, while surety bonds involve three parties, the Principal, the Obligee, and the Surety.
How To Get A Surety Bond?
To get a surety bond, you need to know first what type of bond you want, and second, you need to know the amount the Obligee requires. Then, there will be an evaluation and qualification checking to assess your creditworthiness to determine if you have the resources to fulfill the terms of the surety bond.
You can contact us directly, and we can guide you on how to go through the process of getting a surety bond.
How Much Does A Surety Bond Cost?
The cost of surety bonds varies depending on a number of factors such as the bond type, risk, credit score, length of coverage, and more. Therefore, the premium can vary.
Also, different states and agencies have their own requirements. You can contact All n One Bonding and Insurance directly at our Las Vegas Number (702) 850-7711 or our Memphis number (901) 306-8100 to get the best reasonable quote for your premium.
There Are So Many Kinds of Surety Bonds, Which One Do I Need?
It can be overwhelming to understand the different types of surety bonds. What you get depends on what needs to be done, as well as local laws. You may be looking for either a contract bond or a commercial bond.
Since Surety bonds are tailor-fitted to your needs, we can help you determine the right one. Feel free to contact us at (702) 850-7711 to get the information you need.