We can provide our clients with many different types of bonds. Some of the most common bonds we work with are:
- Performance/Payment Bonds
- Subdivision/Completion Bonds
Our specialized bond department can also assist you with other types of bond products, feel free to give us a call at 503.296.0077 to discuss your account.
1. How does a bond claim get submitted on a bond?
Your bond is only going to pay out to its value. The way a bond pays out is that a complaint would have to be filed with the state which would then notify the bonding company of the complaint. The bond company would then provide you with a timeframe in which to resolve the issue before they pay out on the complaint. If they do pay out on the complaint you are then responsible for reimbursing the bond company for any amount that is paid out.
2. Why is there a personal guarantee with a surety bond?
Unlike a bank loan where the bank holds title to a vehicle, or residence, etc, – some tangible asset, until the obligation is satisfied, the only security the surety has when it offers to bond someone is the indemnity agreement.
The surety is very well aware of the “corporate shield”, therefore, to protect its interests, and not have corporations or LLC’s divert funds should problems occur, the surety requires personal indemnity. The surety must have all avenues of recovery available should a business have a claim, or fail, and the surety has to pay out on a bond. Personal indemnity is required of all bonding companies. If you are in a business that requires a bond, this is part of the risk one takes.
