Types of Bonds
Bid Bond – Guarantees a contractor will enter into a final contract for the amount bid and provide the appropriate performance and payment bonds.
Contract/Performance and Payment Bond – Guarantees the performance of a person or organization in fulfilling the terms of a contract. Most of the contracts are for construction, and the contractor must meet pre-qualifiations standards before being approved for the bond. These generally involve a payment bond for materials, labor and maintenance.
Court Bonds – A general term encompassing all obligations required of litigants to enable them to pursue remedies in the courts.
Crime/Fidelity Bond – Crime insurance protects the insured’s property against burglary, robbery, or theft. The Fidelity insurance covers loss due to employee dishonesty against the employer.
Janitorial Bond – Business service dishonesty bond that protects the business owner from theft of customer’s property by employees.
License and Permits (over $10,000) – Used to describe a bond required by state law, municipal ordinance or regulation, to be filed prior to granting of the license to engage in a particular business or a permit to exercise a particular privelege. These bonds provide payment to the obligee for loss or damage resulting from violations by the licensee of the duties and obligation imposed upon him/her.
Probate Bond – This bond protects against dishonest accountings and a lack of faithful performance of duties by administrators, trustees, guardians, executors, and other fiduciaries. These are sometimes referred to as fiduciary bonds and are required by statutes, courts, or legal documents for the protection of those on whose behalf a fiduciary acts.
Third Party Fidelity – This bond would reimburse a client under some circumstances in the event it can be proven that an employee fraudulently transferred fund or stole money, securities, or other property from such client.
Other/Miscellaneous – All other bonds.