Surety and Fidelity Bonds- Bellefontaine, Marysville, Columbus OH
What is a bond?
First off, bonds are NOT the same as insurance contracts. Bonds involve three parties where insurance involves only two (policyholder and insurance company). The three parties in the bonding process include the following: the surety, the principal and the obligee. The principal is the part who has a duty to perform; the surety (the company issuing the bond) is the party guaranteeing the performance by the principal; and the obligee is the party reimbursed by the surety if the principal fails to perform (the principal is also known as the obligor and the surety is also known as the indemnitor).
How do bonds work?
The price of the guarantee afforded by the surety is the premium charged for the bond. If a principal defaults, the surety must step in to guarantee or complete the work. The surety has a legal right of action against the principal until the amount of the loss is recovered. Therefore, suretyship involves the faithful performance of a principal guaranteed by a surety company that agrees to "stand good" for the completion of an action to the satisfaction of the obligee.
What's the process for getting a bond?
Most bonds require require completion of an application. Dependent on the type of bond requested, a credit report may also be run (by the surety) to determine acceptance. Remember, a bond is a financial guarantee, so an acceptable credit history is necessary. Premium will also be determined based on the application information. Many do not have published rates, but instead are dependent on YOUR situation and financial history.
Bellefontaine Ohio Surety Bonds
- Bid bonds- guarantees that if the obligee wins the bid, he will do the work and furnish a performance bond for the project. If the selected contractor decides not to enter into the contract, the bid bond agrees to pay the difference between the selected contractor's bid and the bid ultimately selected.
- Performance bonds- guarantees that the contractor will complete the contract in accordance with the terms of the contract. If the contract terms are not met, the principal becomes obligated to the obligee and must make restitution for failure to perform.
Fiduciary- required by statute in probate and equity proceedings to guarantee performance of fiduciaries entrusted with property or money of others. Common examples of fidicuary bonds include estate executors, conservatorships, guardians of minors or incompetents, or trustees of trust property.
Public Official Bonds
Guarantees faithful performance by an official of the statutory duties associated with the elected or appointed position.
License and Permit Bonds
Required by governmental entities including states, cities and towns from individuals requesting permission (or license) to take certain action that may affect the public. Many contractors must have license & permit bonds to be able to perform their work.
Bellefontaine Ohio Fidelity Bonds
Protects an employer from the dishonest acts of her or her employees. Examples can include bonds for specific individuals, schedule bonds based on a list of names or a specific position and blanket bonds for all employees.
This is just a sampling of bonds. If you don't see what you need in this list- give us a call at (937) 592-4871 today!
Contact Us Today
If you’re a resident of Bellefontaine, give us a call today to see how we can help. You can also submit your bond request and we'll contact you. We can also help you with other pieces of your business insurance, including commercial auto insurance, general liability insurance and commercial property insurance.
Check out more Bellefontaine, Marysville and Columbus Ohio Surety and Fidelity Bond Resources- Many of Your Frequently Asked Questions are answered on our blog!
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