Surety & Fidelity Bonds

A promise by a guarantor to pay the oblige a specified amount if the principal party fails to meet an obligation (like meeting the terms of a contract). The bond protects the obliged party against a potential loss resulting from the principals failure to meet the terms of the contract or obligation. 

 

Types of Surety Bonds

• Probate and Court Bonds: A probate bond guarantees an honest and faithful performance of duties by individuals in a fiduciary role. These bonds are typically required in the settling of estates for the deceased, mentally incompetent and minors.

 

• Public Official Bonds: A Public Official bond is designed to guarantee that elected officials perform their duties faithfully. The amount of the bond is determined by the post occupied and the duties specified.

 

• License and Permit Bonds: License and permit bonds, also known as contractors bonds are bonds that guarantee the principal will comply with rules and regulations of the obligee which in this case is usually a city or municipality.

 

• Contract and Performance Bonds: Contract and performance bonds guarantee the performance of a contract according to its conditions and terms. Common contract and performance bonds are bid, performance and payment bonds.

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Fidelity Bonds

Fidelity bonds are a type of business insurance. Also known as crime bonds, fidelity bonds are generally designed to protect employers from employee embezzlement, theft and fraud.