Bonding

Auto Dealer Bond

It is not uncommon in the industry for a bond to have several different names, and this bond is a perfect example. The motor vehicle dealer bond is also known as: a used car dealer bond, MVD bond, auto dealer bond, and DMV bond.

The Auto Dealer Surety Bond guarantees that the dealer operates as per the terms of the state in which they operate. This bond is considered a moderate risk by bonding companies; in recent years applicants have been examined more closely.

Bid or Proposal Bonds

This guarantees an owner (obligee) that a party bidding for a contract will, if the bid is accepted, enter into a contract and furnish the other necessary bonds. These include performance, payment, and maintenance bonds for carrying out the work.

If the contractor fails to perform these tasks, the bid bond pays the obligee the difference between the defaulting party’s bid and the next lowest bid.

Completion bond

This bond covers contracts that involve financing or design hazards. It is written in favor of a lender or lessor and guarantees completion of a building or improvement. It is also used where a contractor is responsible for the financing or the design of the contract.

Contract Bonds

These instruments guarantee the fulfillment of contract obligations. These contracts can involve both construction and other type of work or service required by or privately-owned entities.

Contractor License Bond

Contractor license bonds guarantee that contractors will comply with all statutes and licenses required by the state. These bonds are not particularly risky allowing them to be placed with several different bonding companies.

Court Bonds

These bonds are usually required in the course of some action of law. They are often divided into two classes of bonds, plaintiff and defendant. Plaintiff bonds are required of a plaintiff in an action of law. They generally guarantee damages to the defendant caused by the plaintiff`s legal action, if the court should ultimately decide for the defendant.

Since there is no way to predict the outcome of a particular case, the surety company asks for the financial statements of an applicant to determine if they have the financial resources to reimburse the surety should the bond come into play.

Custodian Bond

The Custodian bond, more commonly known as a Guardianship Bond, is a bond that guarantees the performance of the legal guardian in managing the finances of a minor, or disabled individual.

Employee Dishonesty Bond

You should be able to trust your employees. But the fact is, according to a national survey, one third of all employees admitted stealing from employers during the previous year. This problem is so widespread, the U.S. Chamber of Commerce estimates the annual cost of employee theft at $40 billion.

For Example:
The bookkeeper of a gas station embezzled thousands of dollars aover several months. The station owner was unaware of the embezzlement until returning from vacation and finding the bookkeeper gone. The bookkeeper was arrested and convicted. The insurance company paied $8,209.88. An employee of a home supply business stole money and merchandise, and falsified refund slips during two years of employment with the company. The insurance company paid $ 9,748.83.

Three employees of a nanny service stole items from homes in which they worked. One employee stole a gold and diamond ring, another stole a 2 carat diamond ring, and the other stole a wedding set. The insurance company paid the full bond penalty of $10,000.

Estate Bond

This is another name for a Probate Bond. This bond guarantees the duties of the administrators, executors, guardians, trustees, and other fiduciaries of an estate and are required for the estate if minors, incompetent persons, as well as the deceased. Estate bonds are filed in a probate court.

Executor Bond

This bond is just another name for a Probate Bond. The bond, as a rule, is filed in a probate court. Probate bonds are required for the estate of minors, the incompetent, and the deceased. The bond guarantees the duties of the executor of the estate, ensuring proper allocation of the assets of the deceased, minor, or disabled individual.

Fiduciary Bond

A fiduciary bond is just another name for a Probate Bond. These bonds ensure that the executor of the estate will perform in a proper, and legal manner when distributing the assets of minors, the incompetent, or the deceased.

Janitorial Services Bond

Can you trust your employees? How far? If your business is providing janitorial services to other companies, you know how vulnerable you are to employee dishonesty. After all, your employees have access to your customers' assets, equipment, supplies, and personal belongings. Your employees are easy targets for blame. Any customer who finds something missing is likely to suspect those who do the cleaning. The fact is, dishonest employees can significantly damage your business.

These true stories from our files demonstrate what can happen:
An employee was cleaning an auto dealership. A customer left his keys in the night drop; the employee stole the keys and the vehicle. The employee drove the car to another city and wrecked it. Damages totaled $8,417, which Western Surety Company

An employee was cleaning a law office, and found two envelopes containing cash in an attorney`s desk drawer. She stole the money and bought a car. The bonding company paid the full bond penalty of $5,000.

A newly hired employee who was cleaning a bank stole $10,000 cash from the vault. It was his first day on the job. The bonding company covered the full $10,000.

We have designed our special Janitorial Services Bond specifically to provide protection for your customers. You may have good luck and never have problems with a dishonest employee; but if you do, you will rest easier knowing you are covered. Janitorial Services Bond

License and Permit Bonds

These bonds are required of those who must obtain licenses or permits from cities, towns, or political subdivisions before they can proceed with various activities. These bonds, although used for a variety of purposes, usually guarantee that the persons who post them will comply with statutes, regulations or ordinances that regulate their activities.

An operator of a liquor store, for example, may have to post such a bond guaranteeing that liquor will be sold in strict compliance with alcoholic beverage control laws. Electricians and plumbers also must post these bonds guaranteeing that their work will conform to the specifications of a given building code.

There are two broad classifications of license and permit bonds:

  • Those that indemnify a governmental body for the principal`s failure to comply with an applicable law.
  • Those that give a third party the right to pursue the principal, in the third party`s own name, for loss or damage incurred by that third party due to the default of the principal.

A license or permit bond carries a term that corresponds with the period covered by the license or permit issued to the principal. The right to file a claim under the bond continues for varying periods, depending upon the state in which it was issued. Termination of a license or permit bond depends upon the following:

  • whether or not termination is allowed by law;
  • the ordinance under which the bond is required;
  • the terms of the bond itself.

Notary Public Bonds

As a notary you are acting as a public official appointed by your state or county. Laws in your jurisdiction govern your actions as a public official.

If your state requires you to be bonded, this bond does not provide any protection for you as a notary if you make a mistake! The bond is for the protection of the public. You are personally vulnerable to lawsuits if you make a mistake! Don't panic, see Notary Public`s Errors and Omissions for more information on how to protect yourself from these attacks with this coverage.

Maintenance bond

This bond carries the guarantee that faulty work of the principal will be corrected or defective materials will be replaced. A performance bond sometimes includes this maintenance guarantee for a period of one year without additional charge.

Payment bond

This bond, also referred to as a "labor and materials bond", guarantees that bills for labor and materials used in the work project will be paid as they become due. This coverage is usually automatically included in the performance bond so no additional charge is necessary. But, if this bond is written wholly apart from the performance bond, there is an additional charge.

Performance bond

This guarantees the owner that work will be completed according to the contract specifications. A performance bond is the key bond in a work project because the owner of a project not only wants the work completed -- usually within a specified time -- but also completed according to specifications. If either or both of those promises are not fulfilled by the principal, the surety is obligated to satisfy the owner.

Public Official Bonds

Public Official bonds are required of public officials holding office.

Public Employee Blanket bonds are written on all employees of a public entity. They guarantee the honesty and/or the faithful performance of their duties as a public official or employee.

Statutes often require these bonds to be written on an individual basis for those officials with more exposure to assets. These individual bonds are required of those holding positions such as treasurers, mayors, and tax collectors.Contract Bonds.

Probate Bond

A probate bond guarantees the duties of the administrators, trustees, guardians, executors and other fiduciaries of an estate. Probate bonds are required for the estate of deceased persons, minors, and incompetent persons. As a rule these bonds are filed in a probate court.