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What is a Surety Bond?

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A surety bond (pronounced "shur-i-tee bond") can be defined in its simplest form as a written agreement to guarantee compliance, payment, or performance of an act. Surety is a unique type of insurance because it involves a three-party agreement. The three parties in a surety agreement are:

Principal

The principal is an individual, business or other party that purchases the surety bond and agrees to undertake a compliance, payment or performance obligation as promised pursuant to the terms of the surety bond form or agreement.

Surety

The surety is the insurance company or surety company that guarantees the obligation will be performed. If the principal fails to perform the act as promised, the surety is contractually liable for losses sustained.

Obligee

The obligee (pronounced ob-li-jee) is the party who requires and often times receives the benefit of the surety bond. For most surety bonds, the obligee is a local, state or federal government organization.

Expert Surety Bond Insights

How to Get a Car Dealer's License in Texas

Find out how to get a dealer’s license in Texas and start selling automobiles in the Lone Star State, including how to get the surety bond you need.

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What Is a Notary Bond and Why Do You Need One?

When you're required to purchase a notary bond, it can be confusing. What is a notary bond? Why do you need this? Let's answer this because it's serious!

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IFTA Tax Requirements And IFTA Bond Requirements

The IFTA fuel tax was put in place to give each state a fair share of fuel tax revenue. Here are the requirements including the surety bond some states require.

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The 4 Steps To Get Your Electrician License In South Carolina

Learn the 4 steps to getting your electrician license in South Carolina. This post will make getting through the state's requirements easy to follow.

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