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What Is Bond Insurance?
Surety bonds can vary from industry to industry. They are most common in the construction industry, but can be useful in other fields as well. This type of insurance may be compulsory in some circumstances, especially when a business works with a government entity.
What Are Some Common Types of Bond Insurance?
A contract bond protects a company’s customers in the event that the business does not fulfill the terms of their contract, including issues such as missing deadlines, using the wrong materials, and failing to complete the project.
A commercial bond, most often required by government entities, guarantees that a business meets all regulations and requirements for their industry. This bond may be appropriate for businesses such as construction companies.
A fidelity bond protects a business against dishonest employee actions, including theft and embezzlement. It is often most appropriate for businesses that handle large amounts of money or valuable items.
A court surety bond protects a business against specific court losses. This type of insurance often applies regardless of whether the business is the plaintiff or the defendant in the case.