Surety bonds are three-party agreements in which the issuer of the bond (the surety) joins with the second party (the principal) in guaranteeing to a third party (the obligee) the fulfillment of an obligation on the part of the principal.
Obligee: The party (person, corporation, or government agency) to whom a bond is given. The obligee is also the party protected by the bond against loss.
Principal: The individual who is required to be bonded by the obligee.
Surety: A person or institution that guarantees the acts of another person or institution.
To get a more indepth explanation of what surety bonds are, visit our section What is a Surety Bond.
This is a very popular question of new applicants; but what they do not know is just how hard this can be to “ballpark”. Surety Bond premiums very based on several factors. In general, those applying for a commercial bond will fall into two approval categories: the standard surety bond market, and a high-risk market. Depending on which market you fall in will vary greatly your surety bond cost.
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The standard markets for surety bonds are reserved for those with good personal credit, including strong business and personal financials. Any company that cannot provide business financials (new companies) will have to submit resumes of management that show solid industry experience. A rough estimate of the standard market surety bond cost, or premium, would be 1%-4% of the required bond amount. Please remember that this is a broad range because bonds are underwritten on a case-by-case basis, and therefore premiums can be affected by several factors including your business type and what state you are operating in.
The bad credit surety bond market is available for those with poor, or no credit. This program allows these high-risk individuals to be approved by charging a higher premium then the standard market. Applicants with poor credit (a loose rule of thumb is below a 650), bankruptcies, tax liens, unpaid collection, or civil judgments can expect to be placed in the high-risk program. Once again these are very loose guidelines as every applicant is taken on a case-by-case basis.
The cost of a high-risk surety bond will typically vary between 5%-15%, though in rare cases some premiums are as high as 20%.
To learn more about the cost of a surety bond, read our section What Does a Surety Bond Cost.
The easiest way to get a quote for your surety bond is through our online application. It takes approximately 5 minutes to complete and most applicants will receive instant approval. Once completed, you will also be assigned to one of our helpful licensed agents who will review your file to see if anything can be done to lower your rate.
We are able to quote solely off of owner’s personal credit for almost all commercial surety bonds. With additional information like business/personal financials and resumes we may be able to further reduce your rate. Learn more about the underwriting process here.
Using personal credit is one of the methods approved by the government. One thought is that an owner with a sound financial track record will take less risk with the way they run their business.
No, each owner with 5% ownership or more must be on the application as this is the information the underwriter uses to assess risk, and assign a rate. The names on the bond must match the way the company is registered with the government.
Surety Bonds are paid on annual basis, currently none of our markets offer payment plans. We accept all major credit cards, wire transfers and checks.
The single biggest factor in improving your quote is to protect your personal credit. This is the first thing underwriters look at for bonds under $100,000. Additional information that can be used to lower your quote is experience (resume) and financials (business and/or personal).
We currently only take co-signers when required by the underwriter for approval.
For commercial bonds we are typically able to approve anyone who is not currently in bankruptcy or late with child support payments. Learn more about our high risk surety bonds markets by visiting our Bad Credit Surety Bond Program
This is the easy part. Go to our surety bond application page and download the proper application for your bond. Once completed, please send the application to us for review.
To learn more about what you need in order to apply for a surety bond, visit our dedicated page How To Get Bonded and read more about the bond form, what kind of information you need to provide, and more.
Like pricing, this is a hard question to give a firm answer to. There are a variety of factors, such as the underwriters at the bonding company that can bog down this process. Bryant Surety Bonds will do everything possible to expatiate the process; including sending your application to the proper bonding company on the same day it is received.
While some bonds are approved immediately, others can take from one to four business days. After approval, the bonds issuance typically occurs about one to two days after receipt of payment (and any other documents required by the surety for release of the bond).
Yes, our online application does a soft insurance pull through Trans Union. Soft credit pulls for insurance reasons should have no effect on your credit score.
Yes, we pay outside companies to make our site, and therefore your application, are completely secure. Look for the padlock in your browser on our application pages as well as the security emblems on our site.
There are several reasons for this. First, the bonding company tries its best to paint a picture of who you are through your financials, and though this can give a decent picture, it cannot speak of the person you are. By having a spouse sign, a person close to you is commenting on your character. Second, on more legal grounds, married people share joint assets, which in the worst-case scenario, the bonding company may have to draw upon, should there be a claim.
The application will ask for: contact information, name and location of your business, the specific bond type and amount you need, as well as owner information.
Our online application is set up to approve most commercial bonds instantly. These programs are based off of the information input to the application and are valid quotes.
We represent over 20 markets and not all of our sureties allow us to offer instant approvals. Sometimes our agents are able to utilize a non-instant market to offer you a better rate.
Typical issuance time for your surety bond is 24-48 business hours after we receive all your documentation (typically premium payment, and properly signed indemnity agreement).
We can email you a copy of the bond once it has been issued.
Yes, the bond packet we send to you will include the completed bond form, power of attorney, and surety financials. A second packet stamped copy with these three items will also be included for your company's records.
Most bonds run on an annual basis, though some bond forms have specific dates that must be used.
Email or fax your agent with your new address and we will issue a change rider to your bond, a new bond will not be required.
If there is a claim against your bond the surety will investigate it for validity. If the claim is valid and unresolved by the company the surety will pay out. The surety then has the right to both cancel the bond, and look to the company for reimbursement.
First year premiums are fully earned, so it is best to have all your ducks in a row as best as you can when applying for your license. If you license application is rejected please return the original bond to your agent with a copy of the rejection letter. With these two items your agent may be able to process a refund.
Your states bond form has cancellation language in it that requires the surety to give them written notice 30, 60, or 90 days in advance of the bonds cancellation date. In order to give you time to renew, and the surety time to notify the state, we typically send out renewal notices 90 days in advance with a due date that matches your bond forms cancellation language.