A surety bond is a three party agreement between the principal (the person getting the bond), the obligee (the person requiring the bond) and the surety, which guarantees the principal will comply with certain laws, regulations or abide by a contract.
It depends on what kind of bond you need. For instance if you are applying to become a mortgage broker in the state of Georgia, the Department of Banking and Finance requires that you submit your bond to them prior to receiving your licenses. Check with your state or city requirements to be sure.
There is not a set formula for determining the cost of a surety bond. Each bond differs in its guarantee and bond amount. In addition to the amount of the bond and its guarantee, underwriters will look at the applicant’s credit history, net worth and experience to determine the cost of the bond. Depending on the bond, the underwriter may need to see personal and/or corporate financial statements to determine the price.
Since each applicant is different in regards to their credit history, net worth and experience, it is usually not possible to provide a quote without an application. Many times in order to determine the price of a bond the underwriter will need to see personal and/or financial statements. Without a complete application and any other required items an accurate quote cannot be given.
While we can give you a ballpark figure, you might not like the broad range it actually covers. Commercial bonds can vary anywhere from 1% to 20% depending on the bond and the applicant; so, in most cases a ballpark figure is not helpful. If you would like a quote, simply complete an application and we’ll be happy to help in any way we can.
Remember that a surety bond is essentially a financial guarantee. If for any reason you do not fulfill your obligation and the surety has to step in on your behalf, the surety will then come back to you for restitution. If you have had credit problems in the past, a surety might see you as a potential risk. Even if you have had credit problems in the past, The Surety Group, Inc. can still help. With our bad credit program, we’re sure to find a program to fit your needs.
The Surety Group, Inc. prides itself in prompt services. Once we have a completed application and any other required items, we can approve your bond in as little as 24 hours.
The obligee is simply the person or entity that is requiring the bond. For example, if you obtain a State of Georgia Liquor Bond, the State of Georgia is the obligee.
With our vast library of bond forms, chances are we have the form you need. However, since there are literally thousands of bonds out there and not every obligee will notify us of any changes, there might be a few we don’t have. You can try an internet search or simply call the obligee to obtain the most recent bond form.
Unless you have signed a general indemnity agreement for the surety supporting your new bond, you will have to complete a new application. Remember that each bond differs in its guarantee and amount; therefore each new bond will require a new application.
Insurance is a two party relationship where the insurance company assumes the risk of the principal; while surety bond is a three party relationship where the principal still absorbs the risk. A surety bond protects the obligee and not the principal. Where insurance protects you against a risk, a surety bond guarantees you will fulfill an obligation.
Contact The Surety Group, Inc.! Our knowledgeable staff can assist you in all aspects of the bonding process. We look forward to assisting you with all your bonding needs.