Bonds
Bonds
Understanding bonds is a vital knowledge. Basically, a Surety Bond is a written promise by an insurance company saying that your assets are protected. This also serves as a backup to the promises made by someone else. Premier Choice Insurance will work with you to find outstanding products supported by value-added services to commercial banks, savings and loans, insurance companies, finance and loan companies, and credit unions.
Bond insurance is also known as a financial guarantee policy. As the term suggests, it guarantees the payment of principal and interest on a bond, or in certain cases, on other security, in the event of a non-payment by the issuer of the said bond. Premier Choice Insurance is more than willing to provide answers to your concerns and needs. Our company has the right reputation and experience when it comes to helping customers with their bond insurance problems.
To see the importance of bond policy and to determine the kind of coverage or policy you need, get to know the different types of bonds, as discussed below:
Construction Bonds
Construction bond and contract bond are two terms used to refer the same thing, which is why they are used interchangeably. Both are a type of surety bond which are commonly used in construction industries; thus, the name. With this, the project developer can claim from the bond for any financial loss in case a contracted party fails to perform its duties. This is used to ensure that contracts are fulfilled by the party.
Commercial Bonds
This type is also commonly known as a non-contract surety bond. This does not have associated contracting guarantee. Most business owners used this kind of bond to protect consumers from possible financial and physical harm. The common kinds of this bond are as follows: license and permit, probate, receiver or trustee, public official, court and miscellaneous bonds.
Performance Bonds
A performance bond is a type of contract construction bond that guarantees a contractor will complete a project according to the terms outlined in a contract by the project owner, also called the obligee. The obligee can be a city, state, or local government, as well as the federal government or a private developer. One reason these bonds are often required for public projects is to ensure hired contractors are financially and professionally capable of completing the projects they bid on. Surety bond companies that are willing to bond a particular company for a project are, in essence, vetting the contractors capability of completing the specified project on behalf of the project owner.
License and Permit Bonds
This is a specific type of commercial bond. This is required by the government to business owners who are in certain industries. They need to purchase this type of bond before they can legally secure a license for their business. This is the government’s way of protecting the consumers. It serves as a guarantee that these businesses abide to local, state and federal laws.
- Contractor License
- Highway and Street Permit
- Agent/Adjuster/Broker License
- Fuel Dealer
- Professional License
- Automobile Dealer
- Alcoholic Beverage Compliance Bonds
Probate Bonds
This is what usually transpires after someone dies. Many people die with a last will and testament where the executor named therein will handle the administration of the will. He or she will oversee the distribution of the assets and properties of the deceased, according to the latter’s wishes, as stipulated in the will. If the probate bond sum is not specifically stated in the will, the court will indicate the amount. This happens in the absence of an administrator and a will. The court has the discretion to fix the amount for the bond. Such amount can vary from state to state.
- Administrator
- Executor
- Guardian
- Trustee Bonds
Receiver or Trustee Bond in Bankruptcy
Construction bond and contract bond are two terms used to refer the same thing, which is why they are used interchangeably. Both are a type of surety bond which are commonly used in construction industries; thus, the name. With this, the project developer can claim from the bond for any financial loss in case a contracted party fails to perform its duties. This is used to ensure that contracts are fulfilled by the party.
Public Official
In some government agencies, public officials are required to get a bond before they can sworn in. This is because they handle public funds. This serves as a guarantee that they will handle the funds well, according the laws and regulations. The bonding process for this can be confusing, so it’s better to seek the help of surety experts.
- Notary Public
- Sheriff
- Deputy Sheriff
- Constable
- Jailer
- County/City/School Treasurer Bonds
- Court Clerk
- Loan Closing Attorney
- FHA Schedule Bonds
Court Bonds
Oftentimes, certain parties are required by the court to file surety bonds. This is to verify and guarantee their financial integrity and personal credibility, whether they are inside the courtroom or not. This is also required to reduce the risk of financial loss. The two categories of this specific bond are the following: judicial and fiduciary bonds.
- Plaintiff Replevin
- Plaintiff Attachment
- Cost Bonds
Miscellaneous Bonds
These are bonds that are not for construction projects, legal issues, and other common purposes. They are usually used in reinforcing laws like permit and license regulations. The great thing about these bonds is that they are easy to qualify for by most individuals. They are also less risky to underwrite than other bonds.
Fidelity Bonds
These are the type of bonds that include janitorial business and pension plans; Business Services Bonds and ERISA bonds specifically.
Financial Institution Bonds and D&O Coverage
As the name suggest, these bonds generally covers Commercial Banks and Savings Institutions, and other relative institutions.
Find out more about bond insurance. Contact us today for more information. Premier Choice Insurance will always be happy to be of service.
