Then in few short minutes, your bond will arrive directly into your inbox, and just like that, your employees are bonded.
It's a fast and easy way to get the bonds your contracts require. Bonds are issued by A.M. Best Rated "A" insurance carriers and through Dopazo Insurance, a family run independent insurance agency in South Florida with over 20 years of experience with helping small businesses just like yours with their bonding and insurance needs. Click on the video to learn more.
Project owners use bid bonds to prequalify the contractors that submit bid proposals. In addition, contractors often need the financial credentials to accept, perform and complete the job.
However, if the owner selects a bid and the contractor declines the job or retracts the bid, the owner can make a claim on the bond. The claim collects the difference between the original bid and the next highest bid.
Per industry standards, bid bonds are free. In return, the surety expects that a contractor who wins the job will get the Performance and Payment bond from the same surety that wrote the bid bond.
A contract bond is a type of surety bond that guarantees contracts are fulfilled. Most contract bonds are in the construction industry, where they ensure contractors complete projects according to the contract.
If the contracted party fails to fulfill its duties under the bond’s terms, the project developer can make a claim on the bond to recover financial losses. By Federal Law, bonds are almost always required before work can begin on public projects. Private developers can also require them.
The Performance part of the bond guarantees that contractors complete construction projects according to the contractual terms. If a contractor fails to do so, the owner can make a claim on the bond and use the funds to pay another contractor to finish the job. Likewise, the Payment part of the bond guarantees payment for services if a contractor goes bankrupt during a project. In that case, the bond amount can reimburse the people who worked on the project when the lead contractor can’t pay them.
Costs vary widely, from 1% to 4% of the bond amount. Generally, bonds under one million fall right at 3%, but the surety underwrites each contractor to determine the final cost of the bond. Overall, credit, financials and experience are the main factors in bondability and cost. Contact us with questions about your bond.
A guarantee of performance or an agreement where one party, the surety, obligates itself to a second party, the obligee, to answer for the default of a third party, the principal.
A bond that reimburses an employer as the named insured for loss or damage sustained as a result of the dishonest acts of a covered employee up to the limit or penalty amount of the bond.
To compensate for damage, loss or injury suffered or for an actual loss sustained.
The party for whom the bond runs or the party the bond protects against loss. The party in a surety bond contract to whom the right of performance or the obligation is owed.
The party having the primary responsibility of performing the obligation. In suretyship, it is the party whose action, honesty or responsibility the surety guarantees.
A term used in bonding that refers to an endorsement to a bond that modifies policy clauses and provisions, usually by adding or excluding coverage.
The guarantee given for fulfillment of an obligation, the person or organization that guarantees fulfillment of an obligation or the underwriter that guarantees something in the coverage of a bond.
The period of time a bond covers.
An employee or an authorized representative of a surety company who accepts or rejects risks on behalf of that company and determines the coverages, limits, and terms to apply.