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An indemnity bond is required to protect one party from potential losses or damages caused by the actions of another party. It ensures that if a specified event occurs, such as a breach of contract or legal claims, the bondholder will compensate the affected party for any financial losses incurred. This bond provides a layer of security and risk management in various transactions, such as construction projects or business agreements, ensuring that obligations are met and liabilities are covered.
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What is the relationship between bond value and its required rate of return?
The value of a bond is inversely related to its required rate of return. When the required rate of return increases, the present value of the bond's future cash flows decreases, leading to a lower bond price. Conversely, if the required rate of return decreases, the bond's present value increases, resulting in a higher bond price. This relationship highlights how market interest rates and bond prices move in opposite directions.
Difference between indemnity bond and bank gaurntee?
Basing on the credibility of the individual or organization, Banker assures (assurance is no guarentee as per Law ?) and counter signs on their behalf as a second signatory. This is indemnity bond. Banker takes margin money and basing on the limits available to the industry, banker issues bank guarentee. In this case, Banker is the first signatory which is more stronger in terms of payment to the concerned. Any comments Please!....chandiprasad
What is the rate of return required by investors in the market for owning a bond called?
YTM
Why Life insurance contract is not a contract of indemnity?
is fire insurance or medi claim (health ins) or motor insurance or life insurance which of them is a contract of indemnity
How do you replace a lost cashier's check?
In most states, a cashier's check is "good" until cashed. Therefore, you may not place a stop payment on one and have it reissued. In order for one to be replaced, the issuer will typically require that an indemnity bond be purchased in a amount to cover the dollar value of the cashier's check and the bond would have to be open ended since there is no such thing as a stale dated cashier's check.
What is cost of stamped paper required for Indemnity Bond for Income Tax?
Rs.100
Why do you need a indemnity bond?
An indemnity bond is typically required to protect one party from financial losses that may arise due to the actions or defaults of another party. It provides a form of security or assurance that the obligations will be fulfilled, especially in situations where there is a risk of loss or damage.
Will the stamp duty for an indemnity bond change if it is attested by witness?
I can try to answer with respect to the legal status of stamp duty indemnity bond in India.Firstly, an indemnity bond, anyway, will have to be attested. In other words, there cannot be a valid indemnity bond without being attested.Secondly, indemnity bond is an instrument which is on the state list of the Indian Constitution, meaning, it is governed by State Statutes. The Bombay Stamp Act, which provides for Stamp Duty in the State of Maharashtra, levies (a straight/ uniform) stamp duty of Rs. 200/- on an indemnity bond executed in Maharashtra.Thus, stamp duty chargeable on an indemnity bond will notchange if it is attested by a witness, rather it has to be compulsorily attested.
What is the process for indemnity bond?
To obtain an indemnity bond, you need to apply through a bond provider or insurance company. You will need to fill out an application form and provide relevant information about the purpose of the bond. The bond provider will then assess the risk involved and determine the cost of the bond, which you will need to pay to secure the bond.
What happens when License Bond pays out?
When the person acquired their license bond they signed an indemnity agreement. That indemnity agreement states that if there is a claim paid out on the bond the person or persons who signed the indemnity are responsible to repay to the surety all costs associated with said claim. Once there has been a loss on the persons license bond it will be very difficult if not impossible for that individual to get another bond until the claim has been repaid.
What is a discharging and indemnity bonds?
A discharging bond is a type of bond that releases a party from a specific obligation or responsibility. An indemnity bond is a financial guarantee that protects one party from losses incurred as a result of another party's actions or failure to meet certain obligations.
Who issues an indemnity bond?
Surety Cos...frequnrlty same as insurance Cos
What type of contract do you need to get money for your damaged property?
Insurance contract with an insurance company Indemnity bond
When was the first model used indemnity?
The first indemnity insurance model used was fee-for-service plan. This plan required insurers to pay for services only after they were rendered.
How much does it cost for an indemnity bond?
Indemnity bonds can vary in cost based on the state one lives in. Typically you can get $1000 worth of coverage for about $100. The cost may also be based on book value.
How much does it cost for indemnity bond?
Indemnity bonds can vary in cost based on the state one lives in. Typically you can get $1000 worth of coverage for about $100. The cost may also be based on book value.
What does indemnity mean in Insurance terms?
Now this is a good question. To indemnify means you agree to pay some one back for a loss incurred that you are responsible for or may not be responsible for. For example if you are a contractor that is required to post a contract performance bond, you must obtain the bond from an insurance carrier that will agree to provide the bond. In the agreement with the bonding company you must agree to indemnify the bonding company losses that occur. Should you fail to complete the job a bond can be called in and be required to finish or pay for someone else to complete the job. the bonding company is required to furnish the money under the contact for your default. Because you agreed to indemnify the bonding company you are required to repay them for for the default. These type of bonds are financial backed by you and all you assets. they will not provide the bond until you have disclosed all assets and often will require cash collateral to help back the bond. IF you are married they normally require the spouse to also sign the indemnity agreement. Be careful with these type of transactions. Also when you sign a written agreement in a contract they often contain an indemnity clause that requires you to hold them harmless and indemnity them for losses they incur due to your operation. These are normally backed by an insurance policy and if it is determined that it is an insured contract the carrier will make payment in you behalf with you not having to repay them. Keep in mind you can agree in an indemnity agreement to indemnity someone else for items that are not covered as an insured contract. in that case you will be required to pay for the loss yourself. This is a very very complex subject and is subject of massive case law. If you are considering a contract with these type of agreements you should seek legal advice from an attorney. LAST WORD Be very careful about these and fully understand what you are signing
