Call Us 405.603.2176 ☰ ˟
Call Us 405.603.2176
Logo
Social Social Social Social Social
  • Home
  • Get a Quote
    • Auto Insurance Quote
    • Auto Quote Form (short)
    • Bond Request Form
    • Builders Risk
    • Business Owners (BOP) Quote Form
    • Commercial Auto Insurance Quote
    • General Liability Quote Form
    • Liquor Liability Quote Form
    • Workers Compensation Quote
    • Earthquake Quote
    • Farm Quote Request
    • Flood Quote Form
    • Homeowners Insurance Quote
    • Manufactured Home Quote
    • Life Insurance Quote
    • Term Life Insurance Quote
    • Motorcycle Insurance Quote
    • Recreational Vehicle Insurance Quote
    • Renters Insurance Quote
    • Truck Quote Request
    • Watercraft Insurance Quote
  • Customer Service
  • Resources
    • Refer a Friend
    • Carriers
    • Insurance Glossary
    • File a Claim
    • Private Client
    • Community
    • Partners Page
    • News Center
  • About Us
    • About Us
    • Location(s)
    • Testimonials
    • Employee Directory
    • Privacy Policy
  • Contact
Home > Surety Bond

Surety Bond


Surety Bond Information

Surety Bond Information

If you are a contractor (of any industry), you’ll promise clients that you’ll finish their work according to their stipulations. Contracts are not stipulations to take lightly. They are legally-binding. Yet, you can’t eliminate the possibility that a project will go awry.

If you fail to honor your obligations, what can you do? Many businesses turn to Surety Bonds to help in case of project defaults.

What’s a surety bond?

Surety bonds fall under the umbrella of consumer protection. They function like an insurance policy.

If you make a contract with a client, a surety bond functions as a guarantee that you will do the work accordingly. If you fail to follow or complete a contract, the client can file a claim against the bond. Therefore, they’ll be able to recoup some of the money lost by the failure of the project.

How do bonds differ from insurance?

Yes, bonds provide a financial settlement for your clients. Still, they are not the same as insurance.

With insurance, the insurance company pays a settlement on your behalf. Under a bond, however, you must pay the settlement to the affected customer. Therefore, the bond functions like a guarantee that you will cover the customer’s losses in case of a problem on your end. It tells your clients that you have the financial backing behind you to do their work appropriately.

Who are the parties of a surety bond?

Surety bonds involve three parties:

  • The Principal: The person, company or entity carrying the bond. If you are the contractor, you’ll have a bond in your name.
  • The Obligee: This is the individual who benefits from a bond. It’s usually the party who you work with under a contract. They will be the one to make a claim on a bond if necessary.
  • The Surety: The company that issues and maintains the bond. The principal pays the surety a premium to maintain the bond. In some cases, the bonding company will pay a settlement to the obligee initially. The principal must still compensate the bond company, however.

How much bonding do you need?

Countless standards go into determining how much money principals need to carry on bonds. For example, industry standards and a company’s net worth often play a role.

However, one of the best places to look is within a contract itself. Many obligees will require the principal to carry certain bonds. Indeed, they might only award a contract after the principal enrolls in the bond. Work closely with your obligee to make sure you have bonds according to stipulations.

Bonding can help you win contracts and better serve your customers. Let us help you determine the appropriate amount of coverage for your needs.

Carrier
Carrier
Carrier
Carrier
Carrier
Carrier
Carrier
Get Directions
Contact Us Today
Home| Get A Quote| Customer Service| Resources| About Us| Contact
11901 N MacArthur Suite F2 | Oklahoma City, OK 73162
P: (405) 603-2176 | F: (405) 603-1338

15803 NE 23rd St | Choctaw, OK 73020
P: (405) 281-6183 | F: (405) 603-1338

2301 N Main St A | Newcastle, OK 73065
P: (405) 603-1859 | F: (405) 603-1338
Social Social Social Social Social
Logo

Powered by Insurance Website Builder