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Surety Bond Frequently Asked Questions

Below are answers to some of the most commonly asked questions about surety bonds.

You may also want to see our articles What is a Surety Bond? and How to Get Bonded?

What is a surety bond?

A surety bond is a written agreement to guarantee compliance, payment, or performance of an act. Please see our What is a Surety Bond? article for more information on how surety bonds work. There are thousands of different types of surety bonds requirements across the United States. In order to differentiate them, most surety bonds are identified by the industry, license type or business function they cover. Some common examples of surety bond types include Contractor License Bonds, Motor Vehicle Dealer Bonds, Mortgage Broker Bonds, Freight Broker Bonds, Contract/Construction Bonds and Title Bonds.

How much will my surety bond cost?

The cost of a surety bond can range from less than 1% to 12% of the full bond amount (penalty). The cost of some bonds is fixed regardless of the applicant. For other bonds, the cost is based on a combination of your personal credit and the "risk" associated with specific bond. For example, a surety bond that guarantees a tax or other payment obligation is typically more risky, and more costly than a bond that guarantees compliance associated with a license or permit. Request a free, no-obligation quote to find out the exact cost of your bond. It takes just a couple minutes to complete the quote request. For more information, try our Surety Bond Cost Calculator or see our article How Much do Surety Bonds Cost?

Am I going to get a bunch of phone calls?

No. Unlike most other online bonding services, we don't "sell leads" or send your information to others. We work behind the scenes with national A-rated surety companies and negotiate for you, then provide you with the best rate. We will give you a call once your quote is ready, but we won't send your information onto anyone else.

Does Surety Bonds Direct work with insurance agents or brokers who need to buy surety bonds for customers?

Yes, we offer exceptional commissions, direct access to the leading surety markets, and an easy surety bonding process to our agent and broker partners nationwide. Learn more.

Why are bond prices from Surety Bonds Direct so much better than others?

You usually get a lower price from Surety Bonds Direct because you are avoiding fees associated with multiple brokers in the middle. You effectively receive wholesale prices. We can do this because we buy bonds in volume directly from specialty surety bond insurers who compete for your business by striving to offer the best price and value. Find out more about how to choose a surety company.

What is a fidelity bond?

A fidelity bond protects an employer from losses due to employee-dishonesty, or fraudulent acts, such as theft of monies or securities.

How does the surety bonding process work?

We are committed to making the bonding process simple and straightforward. Learn more about how it works.

How do I verify that Surety Bonds Direct is licensed to offer surety bonds?

We are happy to provide you with copies of our state licenses upon request. Additionally, most state insurance department websites have agency license verification pages where you can quickly search for current license status by agency name.

Does Surety Bonds Direct work with credible insurance companies?

Yes, we only partner with AM Best A-rated surety insurance carriers approved by the United States Department of Treasury.

Can I get a surety bond if I have bad credit?

Yes, absolutely. Don’t let poor credit stand in your way. We specialize in securing bonds at low rates for those with bad credit. Learn more about our bad credit programs.

Does Surety Bonds Direct offer bonds to new businesses?

Yes, we work with leading insurance companies that offer surety bonds to new businesses. We will find the best rate available for your situation. Learn more.

What if I need to make a change or request a rider for my bond?

Give us a call or send us an email and we can process the rider to make a change on your bond. The rider does not replace the bond but will become part of the bond document set as an addendum to the original bond.

How long will it take to get my surety bond?

In most cases it is possible to receive your surety bond in as little as one business day. In some cases, you can even receive your bond on the same day.

What forms of payment do you accept?

We accept Visa, Mastercard, American Express and Discover. We also accept payments by wire transfer, ACH or by personal check.

Can I spread out the cost of my surety bond over time?

Yes, in many cases. Premium financing is available to applicants for many surety bonds. Learn more about premium financing.

What is personal indemnity?

Indemnity is an agreement to provide financial reimbursement to another party in order to offset a loss or damage incurred. Surety companies require the indemnity of the owners of closely held businesses as part of the surety bond application. This ensures that the surety can access personal assets if required for reimbursement in the event of a loss.

Are court and probate surety bonds eligible for premium financing?

Unfortunately, court and probate surety bonds are not eligible for premium financing.

Do court surety bonds require collateral?

Yes, court surety bonds always require that collateral be posted in advance in the amount equal to 100% of the bond obligation. The collateral must be in the form of cash, or cash equivalent and is in addition to the premium charged for the surety bond.

Who prepares my surety bond form?

Surety Bonds Direct will prepare the required surety bond form on your behalf. The information required on the form will be pre-populated by our systems. In most cases, you will simply need to sign the bond form.

What should I use for surety bond effective date?

The effective date is the date the surety bond becomes active or in force. The date to use for effective date varies based on the specific surety bond and applicants should check with the obligee for specific requirements. In most cases, the effective date must be set prior to a licensing date. For surety bond renewals, effective dates are typically set on the expiration date of the prior bond to ensure continuous coverage.

How do I know the bond amount to request?

The bond amount required will usually be dictated by the obligee (licensing or other state, federal or local government authority requiring the surety bond). In many cases, the required bond amount is displayed automatically once you select your state and bond type in our online quote form. If you are still unsure of your bond amount, send us an email or give us a call and our bond specialists can help determine it for you.

Does Surety Bonds Direct offer bail bonds?

No, we do not provide this type of bond.

Does Surety Bonds Direct provide other insurance products in addition to bonds?

We specialize in bonds only, so we don't sell any other insurance products at this time. However, we can refer you to quality insurance providers if you would like. Just ask your bond specialist for a referral.

How is surety different from insurance?

Unlike insurance, surety bonds typically are required for the benefit of a third party such as states or consumers rather than the bonded business or individual. Surety is also unique in that it involves a three party agreement between the bonded entity, the obligee (entity requiring the bond) and the surety company. For more information see Surety is Different than Insurance.

Will Surety Bonds Direct notify me when my bond is due for renewal?

Yes, we proactively alert our customers of upcoming bond renewals. We also strive to lower bond costs whenever possible at the time of renewal.

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