Popular Surety Bonds in San Diego, California
Overview of San Diego Surety Bonds
If you want to open a business in San Diego or work in a particular industry, say as a contractor, you may need to get a license bond as part of your licensing process. Auto dealers, contractors, freight brokers, sellers of travel, process servers and others, all need to get such a bond.
Licensed contractors in the state of California who want to work on public works projects may also be required to obtain a contract bond before they can perform work. In San Diego, such contractors must obtain a Bidders’ Guarantee of Good Faith Bond for bids of $25,000 and more, as well as payment and performance bonds if they are awarded a contract.
Individuals in San Diego appointed as fiduciaries or those appealing a court decision may be asked to obtain a third type of bond - a court bond.
The function and purpose of all of these bonds is to guarantee that bonded businesses and individuals will comply with local laws, such as the City of San Diego Municipal Code as well as any applicable state laws.
If a bond’s conditions are violated by the bonded party, the principal, a claim can be filed against the bond for compensation for any damages or losses incurred. Such compensation can be as high as the full penal sum of the bond. Any compensation extended by a surety must then be repaid by the bond principal in full.
For a detailed explanation of how bonds work, and why they are required, see our ‘What is a surety bond’ guide!
Keep on reading to find out more about how much bonds in San Diego cost, what gives rise to a bond claim, and how to apply for your bond.
If you have any questions about getting bonded or about a specific bond, call us at 866.450.3412 anytime!
Surety Bond Cost
The cost of your bond is a percentage of the full amount of your bond. So, if you are asked to obtain a bid bond for public works in San Diego in the amount of $25,000, you will need to pay a premium which is a fraction of that amount.
How much you need to pay depends on your credit score, along with other personal financial information. Applicants with high credit scores, 700 FICO and above, typically get a low rate on their bond, whereas applicants with lower scores need to pay slightly more.
Rates also vary from bond to bond but for high credit applicants, the lowest possible rates on a bond are typically around 1% of the total amount.
For a precise and free quote on your bond, submit a surety bond application, and we will shortly contact you with more details.
Bonds With Bad Credit
Applicants for a bond who have a lower credit score, can get bonded just as easily as everyone else!
Our Bad Credit Program enables such applicants to apply for a bond from the same surety companies that issue all our bonds, and get bonded as fast as all other applicants, though at a slightly higher rate. But by improving your score over time, you can get increasingly better rates on your yearly bond renewals - guaranteed!
To request a quote or find out more about this type of bonds, see the program page.
Surety Bond Claims
Bond claims arise out of the violation of the conditions of the bond by the bonded party (the bond principal). Every bond is conditioned differently, depending on the type of guarantee it is intended to provide.
For example, under the City of San Diego Municipal Code Chapter 12, Article 9, Division 01, Section 9, contractors who perform work on the Public Right-of-Way must post a performance bond in order to obtain the required permit to perform such work.
This bond is conditioned upon the completion of any work such contractors perform, in accordance with the requirements of the Municipal Code, and the conditions of the permits itself. If a contractors fails to complete any work they have been contracted for, the City of San Diego may end up filing a claim against the bond.
The surety then compensates the claimant, in this case the City, for any damages or losses sustained due to the default of the contractor and failure to perform. In turn, the contractor is obligated to repay the surety in full.
Apply for Your Bond Today!
Apply for your bond by completing our surety bond form!
We will then contact you with a free quote and further details on finalizing your application.
Your bond will be issued within two working days, and we will immediately forward it to you via mail and e-mail.
Want to know more about the bonding requirements in the city? Call us at 866.450.3412 to speak to one of our surety professionals.