Surety Bonds

What is a Surety Bond?

There are many types of bonds. The Commercial surety market includes numerous types of bonds. We will help you understand your options and find the ideal bond according to your needs.

Get Help With Insurance provides Surety Bonds in Nevada. Surety Bonds are a promise to pay one party a certain amount if the second party fails to fulfill an obligation or terms of a contract.

A Bond guarantees the performance of a contract or other obligation. Bonds are three-party instruments by which one party guarantees or promises a second party the successful performance of a third party. Common types of bonds are license and permit, notary, bid, court and probate, fidelity, fiduciary, sales tax permit, executor, dishonesty, etc.

A surety bond is a contract between three parties:

• The principal (you),
• The surety (us) and
• The obligee (the Entity requiring the bond)—in which the surety financially guarantees to an obligee that the principal will act in accordance with the terms established by the bond.

Some contracts require that your business needs to be properly bonded. Surety Bonds helps all sizes of businesses win contracts by providing the customer with a guarantee that the work will be completed. Many public and private contracts require surety bonds, which are offered by surety companies.

Authorized surety companies provide surety bonds to businesses that meet their qualifications.

Get Help With Insurance also write fidelity bonds, which cover losses arising from employee dishonesty and errors & omissions liability insurance.

Contract bonds guarantee the performance of obligations covered by a written agreement between two parties.  The most common types include bid, performance and payment bonds.

If you have questions, or would like additional information regarding surety bonds, please send us an Email or call (702) 541-0882 to Request a Bond with the requirements needed. We need to know who is requiring the bond, how much should the bond be and what type of bond that you need.

Bonds

Ancillary bond ensures completion of requirements outside of performance or payment such as maintenance.

Bankruptcy Trustee Bond Bonds which provide protection to the beneficiaries of the bankruptcy action that the bonded trustees, appointed in a bankruptcy proceeding, will perform their duties and handle the affairs according to the rulings of the court.

Common types of bankruptcies are:

• Chapter 7: calls for the “liquidation” of a business and allows for the sale of the assets to pay outstanding debts.
• Chapter 11: calls for the “reorganization” of a business and the debtor remains in possession of the assets after the filing of a plan for the reorganization.

Bid or Proposal Bond These bonds are used by owners to pre-qualify contractors submitting proposals on contracts. The coverage provided by a Bid or Proposal Bond is that the bidder, if awarded the contract within the time stipulated, will enter into the contract and furnish the prescribed Performance & Payment Bond(s). Default will ordinarily result in liability of the surety not to exceed the dollar value set forth in the bond for the difference between the amount of the principal’s bid and the next low bidder who can qualify for the contract.

Blanket Bond: Bonds which protect against dishonesty of all of the employees of an entity to the stated amount of the bond.

Blanket Position Bond: Bonds which protect against dishonesty of each of the employees of an entity stated on the bond to the stated amount of the bond.

Blanket Public Official Bond: Blanket public official bonds cover all public employees of the public entity stated on the bond to the stated amount of the bond.

Business Service Bond are used if you employ individuals who work in clients’ homes or businesses in Nevada, you can get bonded to protect clients against theft

Certificate of Title Bond is used if you have a lost, stolen or defective vehicle title in Nevada, you must be bonded.

Commercial Bond: A general classification of bonds that refers to all bonds other than contract and performance bonds. Commercial bonds cover obligations typically required by law or regulation. Each bond is unique to the circumstances at hand.

Commercial Blanket Bond: These bonds provide a single amount of coverage to cover dishonest acts of employees, regardless of the number of employees involved in the loss. In other words, this type of bond covers all employees to the amount stated on the bond.

Contractors Board License Bond are required for individuals licensed as contractors in the state

Contract bond: A general classification of bonds that provide financial security and construction assurance on building and construction projects by assuring the project owner (obligee) that the contractor (principal) will perform the work and pay certain subcontractors, laborers, and material suppliers.

Court and Probate Bonds: Judicial and probate bonds, also referred to as fiduciary bonds, secure the performance on fiduciaries’ duties and compliance with court order, e.g. administrators, executors, guardians, trustees of a will, liquidators, receivers, and masters. Judicial proceedings court bonds include injunction, appeal, indemnity to sheriff, mechanic’s lien, attachment, replevin, and admiralty.

Defendent Bond: Defendant bonds counteract the effect of the bond that the plaintiff has furnished. They often require the posting of collateral to be written.

Errors & Omissions: A policy that provides coverage for an insured in the event of unintentional mistakes. Errors and Omissions Insurance, commonly referred to as E&O, covers damages arising out of the insured’s negligence, mistakes, or failure to take appropriate action in the performance of business or professional duties.

Fidelity Bond: Bonds designed to protect against dishonesty. Generally, the bond protects against dishonesty of employees. These bonds cover losses arising from employee dishonesty and indemnify the principal for losses caused by the dishonest actions of its employees.

Fiduciary Bond: Bonds which protect against dishonest accountings and a lack of faithful performance of duties by administrators, trustees, guardians, executors, and other fiduciaries. Fiduciary bonds, often referred to as probate bonds, are required by statutes, courts, or legal documents for the protection of those on whose behalf a fiduciary acts. They are needed under a variety of circumstances, including the administration of an estate and the management of affairs of a trust or a ward.

Health Care Facilities and Services Bond are required If you operate a health care facility in Nevada

Individual Bond: A term generally used with public official bonds, which refers to bonds written in the name of the specific public official.

Legal Document Assistant Bond are required if you assist with the preparation of legal documents in Nevada.

Large Deductible Plan: A type of insurance program bond in which the insurer pays all losses, including those that fall within the deductible, and seeks reimbursement from the policyholder on a monthly or quarterly basis. The bond protects the insurer in the event the policyholder does not reimburse the insurer for losses within the deductible.

License and Permit Bond License and Permit Bonds are required to obtain a license or permit in many cities, counties, states or other political subdivisions. They may be required for a number of reasons, including the payment of certain taxes and fees or providing consumer protection as a condition to granting licenses related to selling things such as motor vehicles or contracting services.

Maintenance Bond: The normal coverage provided by a Maintenance Bond is a guarantee against defective workmanship or materials for a specified period of time after a project is completed. Maintenance periods range from one to several years; however, the standard is one year.

Miscellaneous Bond: Miscellaneous Bonds cover performance of contracts and agreements with private parties and government agencies. e.g. lost securities, utility deposit, wages and welfare.

Name Schedule Bond: A type of public official or fidelity bond that lists the specific names and amounts of each named individual bonded. Name schedule bonds use one bond, but attach a schedule of individual names of the bonded public officials. Each name will list a specific dollar amount for which that individual is being bonded. These may be used to bond a panel of city council members or similar body of officials.

Notary Bond Include bonds that are required by statutes to protect against losses resulting from the improper actions of notaries.

Payment or Labor & Material Bond: The coverage provided by a Payment Bond or Labor & Material Bond is that the contractor will pay for certain labor and material used in the prosecution of the work which he is obliged to perform under the contract. Since liens may not be placed on public jobs, the payment bond may be the only protection for those supplying labor or materials to a public job.

Performance bond The coverage provided by a Performance Bond is that the principal will faithfully perform the terms and conditions of a written contract. These bonds frequently incorporate payment bond (labor and materials) and maintenance bond liability. This protects the owner from financial loss should the contractor fail to perform the contract in accordance with its terms and conditions.

Plaintiff Bond: Plaintiff bonds are required of a plaintiff in an action of law. They generally protect against damages to the defendant caused by the plaintiff’s legal action, should the court decide for the plaintiff. The coverage provided by a Performance Bond is that the principal will faithfully perform the terms and conditions of a written contract. These bonds frequently incorporate payment bond (labor and materials) and maintenance bond liability. This protects the owner from financial loss should the contractor fail to perform the contract in accordance with its terms and conditions.

Position Schedule Bond: A type of fidelity or public official bond, which lists specific positions and their corresponding penalty amounts. Position schedule bonds use one bond, but attach a schedule of positions to be bonded. Each name will list a specific dollar amount for which that individual is being bonded. This type of bond may be used to bond certain positions that have a high amount of turnover. Using a position instead of a name will reduce the paperwork involved year-to-year.

Public Official Bond: Public Official Bonds protect against dishonesty and lack of faithful performance by a public official. These bonds are required by statutes and ordinances.

Reclamation Bond: A bond which provides protection in the event that a person or entity does not restore land, that it has mined or otherwise altered, to its original condition.

Retrospective Plan Bond: Type of insurance program bond in which the final premium is a combination of incurred losses and an administrative charge. Retrospective plans are loss sensitive insurance plans. Since final loss costs may take years to develop, the bond covers payment of the final premium amount.

Self-Insurer Retention Plan Bond: A type of insurance program bond that is commonly used with Workers’ Compensation insurance, General Liability coverage or other liability coverage where limited coverage is available or coverage, when available, may not be affordable.

Supply Bond: Supply Bonds guarantee performance of a contract to furnish supplies or materials. In the event of a default by the supplier, the surety indemnifies the purchaser of the supplies against the resulting loss.

Surety Bond: Surety bonds are three-party agreements in which the issuer of the bond (the surety) joins with the second party (the principal) in providing protection to a third party (the obligee) regarding fulfillment of an obligation on the part of the principal. An obligee is 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.

Vehicle Industry Business License Bond are required for individuals licensed in the vehicle industry (EG dealers, brokers, wreckers) that provides consumer protection related to including the payment of certain taxes and fees or as a condition to granting licenses related to selling things such as motor vehicles or contracting services.

Workers’ Compensation bond laws, at the state and federal level, require employers to compensate employees injured on the job. An employer may comply with these laws by purchasing insurance or self insuring by posting a workers’ compensation bond to guarantee payment of benefits to employees. This is a hazardous class of commercial surety bond because of its “long-tail” exposure and potential cumulative liability. The “long-tail” exposure stems from the two statutory bond forms:

Traditional – bond form: The surety is liable for payment of the principal’s workers’ compensation obligations occurring during the time the bond is in force. When the bond is canceled, the surety continues to have liability for all workers’ compensation claims incurred between the effective date of the bond and the cancellation date of the bond. Last surety on – bond form: The surety assumes all past, present and future liability to pay the principal’s self-insurers workers’ compensation obligations. The surety is released from all accrued liability if the surety cancels the bond and the principal later posts an acceptable replacement security.

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