How Does a Surety Bond Work?

SO JUST EXACTLY HOW DOES A SURETY BOND WORK?

Surety bonds are an insurance policy for the obligee or the entity that is initiating the project. In most situations, the obligee is a government agency, and the bond is in place to ensure the government is protected. Surety bonds operate as a form of insurance to the obligee, since the obligee is the beneficiary that can file a claim if the bond’s obligation is not met.


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OBLIGEE

This is the entity, often times a government agency, that is requiring the bond


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PRINCIPLE

This is the contractor or subcontractor that needs to get bonded


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SURETY

This is a third party bonding company that provides and backs the bonds


Let Surety Bonds Inc. find the right Bid Bond, Performance Bond, Payment Bond, or License Bond for you and help protect your business.