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Sureties and guarantees issued to third parties for the fulfilment of contractual liabilities. = Answer == Bonding is frequently called ""reverse insurance". Insurance is intended to pay someone for damages by an event that, may or may not have any fault, but is essentially expected to possibly happen, (like a house fire). An insurance company expects to pay some losses - the risk of that loss, to the degree that it is more than the fee/premium charged, is shifted from the insured to the insurance company. Bonding on the other hand, is a way to assure payment (or performance of something) for an event that really should never happen. If payment/performance under a bond must occur, the Bonding Company will try and get paid by the one it bonded. It never agreed there should be or to accept any loss. Hence, along with a fee the company normally gets security/liens/mortgage that it feels is adequate to reimburse it for any amounts it pays. Bonds come in many, frequently specific & independent forms. For example, it is common that a building contractor will have to provide 3 different bonds in many jobs: Bidding, Performance, & Payment. The bid bond assures that if he bids to do a job - wins the bid - and then doesn't agree to to the job as bid, the one who was requesting the bid (and now has to go through the time and expense of redoing it all) gets compensated. The contractor may also have to provide a Performance bond, which basically means if he fails to complete the contract, (walks off the job, etc., ) and the buyer needs to get someone else to do it, there is compensation in the bond amount. This bond may even cover the warrenty period, so there is a way to assure the contractors 10 year guarantee, if say, he's gone then. (Sometimes, instead of paying, the Bonding Company will/must actually step in and hire another contractor to perform). There may be a bond required to assure that payments made to the general Contractor that should be paid to the sub contractors , suppliers or employees, are actually paid to those people. (If the contractor fails to pay a supplier/worker, those people actually have a lien against your property until they are paid, even if you paid the contractor). Hence, a bond is essentially that a large, capable organization (generally an insurance company), agrees that those taking on a responsibility are actually responsible, or the bonding Company will perform in its behalf or compensate....and then get renumeration from the one causing the problem. In most job situations, it means you are considered responsible to be trusted with money, (under what would be expected to be controlled guidelines of your employer). Just being able to be bonded for something, indicating another presumably large/reputable company will stand behind you, is a sign of quality and integrity.

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โˆ™ 2006-04-20 20:22:57
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Q: What is surety insurance?
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Is insurance policy a surety?

An insurance policy is not a surety. Insurance is designed to pay for losses that are sudden and unexpected without the obligation of the insured to reimburse the insurance company whereas a surety expects repayment from the principal who purchased the surety bond.

How Surety can be compared to insurance policy?

Both insurance and surety provide protection against financial loss. Insurance anticipates losses and charges a premium with that in mind where surety companies expect no loss and the premium charged is a 'service fee'. Surety bonds involve three-parties the surety company, principal and obligee. Insurance involves two-parties the insurance company and the insured. With insurance the risk is transferred to the insurance company where as with surety the risk remains with the principal. The surety is providing a guarantee against loss by agreeing to be responsible for the obligation of the principal.

Who bought Surety Life Insurance?

The Allstate Corporation bought Surety Life Insurance in 1981.

What is a surety agent?

A surety agent is a licensed insurance agent that has experience and represents surety companies. The surety agent is able to solict and place surety bond requests.

How to become a surety agents?

You need to have an insurance license to transact surety. Then, you would need to establish experience in the field of surety either by working for a surety company or surety agency.

What is the role of the surety in a surety insurance contract?

The surety, then, is the party which guarantees that either the principal will perform adequately or the obligee will be compensated for the principal's failure.

What insurance does Western Surety Company offer?

Western Surety Company, founded in the year 1900, is an insurance company based in Sioux Falls, South Dakota. It is a leader in small, miscellaneous fidelity and surety bonds.

Who is the industry leader in surety insurance?

Of the companies which primarily provide surety insurance, the industry leaders include Travelers Surety and Casualty Co. of Hartford, Connecticut, whose 200,000 employees generated $27 billion in sales for 1998

Where do you purchase a surety bond?

You can attain a surety bond through youir local insurance agent. There are also a number of on line surety providers. Among them is

How do you obtain a surety bond in tn?

You can attain a surety bond through youir local insurance agent. There are also a number of on line surety providers. Among them is

How large is surety insurance in proportion to the property and casualty insurance industry?

Surety insurance accounted for approximately 1.1 percent of property/casualty sales in 1995 and accounted for a similar proportion of the jobs within the industry.

What has the author Archibald Moore written?

Archibald Moore has written: 'Province of Lower Canada, Court of Appeals, July session, 1817' -- subject(s): Insurance, Surety and fidelity, Salvage, Surety and fidelity Insurance, Surety and fidelity insurance, Assurance de cautionnement, Sauvetage maritime

How can one contact Surety Insurance?

There is no company called Surety Insurance. However one can contact almost any company through email, mail, telephone, or in person (at a company location).

What is the most common type of surety insurance?

The most common type of surety insurance is construction bonding, which insures that contractors will be able to complete a construction contract and pay their suppliers and subcontractors.

What is the origin of the commercial surety insurance industry in the United States?

he commercial surety industry in the United States did not begin until 1884 with the incorporation of the American Surety Corporation of New York

What do you do to be bonded?

Your first step in obtaining a surety bond is to contact a surety agent that is familiar with the bonding process. There will be an underwriting process associated with obtaining the surety bond but the surety agent will be able to assist you with more detailed information. Before the surety will give you a bond, you will have to go through a rigorous prequalification process because surety (unlike insurance) is a financial backing. It is more like a credit facility than an insurance policy. Surety companies will therefore thoroughly examine you and your company to ensure that you can perform as stated in your contract or license.

What is the difference between a surety bond and workers compensation?

A surety bond is a form of guarantee. Workers compensation is an insurance program. There is absolutely no relativity.

What is a surety company?

The surety company is usually an insurance company that is guaranteeing the obligation of another party in a contract. In order for a company to write surety bonds, it must be licensed by the insurance departments of the states in which they conduct business. A surety bond is a contract between three parties. The obligee, principal and surety company. The obligee is the party requiring the bond and will be in receipt of the contracted work. The principal is the primary party who will be performing the contracted obligation and the surety ensures that the principal's obligation will be performed.

Who issues an indemnity bond?

Surety Cos...frequnrlty same as insurance Cos

How do you get bonded and insured?

Bonded and insured are two completely different processes. Being bonded means you have been prequalified by a surety company to perform the duties in your license or contract. It is a three party agreement between the surety, the principal, and the obligee whereas insurance is only two parties. Surety bonds are more like a credit facility than an insurance policy. To obtain a bond, contact a surety agent that is familiar with the bonding process. There will be an underwriting process associated with obtaining the surety bond but the surety agent will be able to assist you with more detailed information.

Where can you find Platte River Insurance Company surety bonds?

loocking for renew a Bond

How do you get a surety bond?

The easiest and fastest way is to work with an insurance broker like my self.

What are some well known Surety Bond companies?

There are many Surety Bond companies. Some of the more known companies include American Alternative Insurance Corporation, Federated Mutual Insurance Company and Partner Reinsurance Company of New York.

What types of businesses offer a surety bond?

Surety bonds can be offered from a wide range of businesses. They are primarily offered form bonding agencies, but can be seen coming from places such as insurance agencies and even businesses and websites solely developed to offer surety bonds.

Under what circumstances is surety bonding usually offered?

Because it is different in other ways, surety bonding is usually offered through a separate division or department within an insurance company and is governed under a different set of laws from other insurance lines.