A surety is a contractual document that three parties create. The sides are an obligee, principal and a surety company. The principal is a business person or entity that wants to buy a surety bond. An obligee sets the bonding process in motion when they request a bond from their contractors. A surety is usually an insurance company of good standing.
How Bonds Work
A bond works as a guarantee of contract performance. When your surety company processes a bond for you, it’s backing you up. It gives an assurance that you can accomplish a specific contract. The contract ensures that all parties involved play their part to make the project a success. In the event of non-performance, the obligee can and usually does claim the bond. If their claim succeeds, the obligee receives compensation for loss from your surety company. You will then have to reimburse the surety company.
New customer needs arise from time to time. Innovative surety companies continue to create new products in response. As a result, there are thousands of surety types. A resourceful Nebraska surety bond company can help you pick a bond that most suitably solves your problem. For example, have you been thinking of starting a home cleaning business in your county? Consider buying a fidelity bond. Are you a construction contractor? You need to contact a Nebraska surety bonds company of your choice to address such a requirement. Let us teach you how to get bonded in Nebraska.
Types of Surety Bonds in Nebraska
We have seen thousands of different types of bonds. It may not be possible to discuss all of them here. However, there’re a few types that professionals and business people in various industries need.
- Contract bonds – guarantee that a contractor will execute the project within the dictates of the contract. Have you established a new construction company? You need to have a full understanding of how Nebraska contract bonds work. State governments typically request construction bonds for all public projects surpassing $100,000. While different states may have different requirements, they all strive to adhere to the provisions of the Miller Act. Examples of contract bonds are performance bonds, bid bonds, payment bonds and maintenance bonds.
- Commercial sureties – aim at protecting businesses and consumers. The Nebraska state requires commercial bonds from players in various industries. Your state will not process your license until you present an appropriate surety. The government uses these bonds to ensure businesses act responsibly toward their consumers. Examples of commercial sureties are ag dealer bonds, auctioneer bonds, license and permit bonds, mortgage broker bonds, and warehouse bonds, among others. One of most common commercial bond types is the license and permit bond.
- License and permit – have you decided to build an auto dealership in your state? You should get all the applicable licenses. You will have to obtain a license and permit bond before you open your new business’ doors.
- Fidelity – you have employed the right people in your new office cleaning business, right? But do you have the assurance that all of them are trustworthy? Employees can and do steal from customers. Some of your workers may be handling company cash, and there’s always a risk that they may steal from you. Examples are business service bonds, ERISA bonds and standard employee dishonesty bonds. Get the right fidelity bond and have peace of mind.
- Court bonds – protect parties from potential losses that may arise from decisions of courts. There are two categories of these bonds: civil court bonds and fiduciary bonds. If you are a plaintiff in a civil suit, you may need to buy a plaintiff bond. A court usually requests defendants in court cases to provide defendant bonds.
- Fiduciary bonds – court bonds that ensure that a fiduciary will responsibly manage the estate or finances of a minor, a deceased or incapacitated person. Examples are guardianship bonds and administrator bonds.
Industries that require bonding:
- Agriculture: are you a dealer in agricultural products? You need to buy the right ag dealer bond. Examples are hay dealer bonds, milk dealer bonds, livestock dealer bonds and produce dealer bonds.
- Travel industry: If you work in the tours and travel industry, you need to purchase a travel agent bond. Another name for a travel agent bond is a seller of travel bond. Its purpose is to ensure that travel agents handle transactions and money in a way that’s legal and ethical.
- Building and construction industry: contractors handling public projects need to purchase construction bonds for the procuring entity. These bonds guarantee that the contractor will complete the project. They also ensure that subcontractors and suppliers to the contractor get their payments.
- Cleaning industry: If you run a cleaning service, you should consider buying a fidelity bond. The state may not require that you buy a fidelity bond. However, realize that some well-informed potential customers may not want to contract cleaning services without a business service bond. When pitching to prospects, have them understand that you have a sufficient surety bonding.
Getting Bonded in Nebraska
There’re as many surety types as can confuse a buyer. You need not worry. We are a reliable bonding and insurance company. After doing some due diligence on your request, we can issue you a bond within 24 hours (depending on the type). If your credit is good, we can give you the best rates available. We can still offer bonding even if your credit score is bad. Your score is a determinant of the premium you pay. Expect to pay between 1%-10%, depending on your score is.
Having accurate information about bonds is vital. Some bonds are a requirement by the various government departments. Some, like fidelity bonds, are not a requirement but can save you from trouble. Call or visit us today and get the bond you want.
Apply for your bond now by completing our surety application.