Surety Bond vs. Insurance
In traditional insurance, the risk is transferred to the insurance company. In surety bonding, the risk remains with the principal. The protection of the bond is not for the principal, but for the obligee. With insurance, the insurance company considers that a certain percentage of the premium for the policy will be paid out in losses. In true suretyship, the premiums paid are "service fees" charged for the use of the surety company's financial backing and guarantee. In surety bonding, sureties view their underwriting as a form of credit so the emphasis is on prequalification and selection. Not everyone is eligable for bonding, these days it is getting harder and harder to obtain a bond. Finding a bond with poor credit or a new business only adds to the frustration of finding someone to write a bond for you. If you are in this situation, then refer to our Bad Credit Surety Bond Program.
