Surety bonds guarantee that suppliers can meet financial obligations when contracted performance targets are missed. Many major projects are impossible without them. Howden consultants take the stress out of the entire process, from successfully aligning with the terms of the contract, to managing the claims process and advocating for you.
A Surety is a contract between three or more parties: a supplier of some kind, their client and an insurance company (surety bonds are available through banks also, but banks tend to be less flexible in their terms and the bond exists on your balance sheet, whereas the insurance company’s surety does not).
Contractor’s Bond – A contractor’s license bond is a type of commercial surety bond required by the state of California for the benefit of a contractor’s customers or employee’s should they be financially damaged as a result of a contractors unlawful actions.
Customs bond – is a contract between three parties (Customs, a principal (i.e. an importer), and a surety) to ensure that all the duties and fees associated with the rules and regulations of importing or other Customs activities are paid to Customs by the principal.
Judicial Bonds – (also known as Litigation Bonds) are used when entering into a civil proceeding. The purpose of Judicial Bond is to ensure you can pay the costs in relation to the legal action.
Guaranteed bond – is a debt security that offers a secondary guarantee that interest and principal payments will be made by a third party, should the issuer default due to reasons such as insolvency or bankruptcy. A guaranteed bond can be of either the municipal or corporate variety. It can be backed by a bond insurance company, a fund or group entity, a government authority, or the corporate parents of subsidiaries or joint ventures that are issuing bonds.
A license bond is a bond that is required by certain governmental entities, such as a municipality, which allows someone to engage in a specified activity (as you can see below – there are a lot of types of these bonds). The person seeking the bond is needing this permit bond to perform the activity and the bond ensures that the party wanting the bond will comply with the rules and regulations of the municipality. The person seeking the bond is known as the Obligor and the governmental entity is the Obligee.
Fidelity bond – is a form of business insurance that offers an employer protection against losses that are caused by its employees’ fraudulent or dishonest actions. This form of insurance can protect against monetary or physical losses.