Understanding Surety Bonds?
Being sure about your business needs is crucial to staying afloat, especially in a competitive world where not everyone can be trusted. Imagine conducting business with someone who promises to perform a service for you. On the day they are to perform said service, they fail to show up.
Imagine hiring a contractor for an expansion that is desperately needed for your business to grow to the next level. Your highly recommended contractor is doing a fabulous job. Everything is on schedule and your Grand Opening of the new wing of your business is planned for the end of the following month. You order food, entertainment, print invitations, and media to cover the opening and 3 weeks before completion, your trusted, high-producing contractor suffers some personnel issues and is unable to maintain the work pace because he no longer has qualified employees. The job, that you already paid for, is shut down. You cannot find a replacement contractor. You cancel your Grand Opening Celebration. How much money would you lose? It could mean a significant loss unless you had protection against losses from obligations not being met. Surety Bonds are an insurance product that covers contractors.
Surety (or Commercial) Bonds are used to protect the obligee (client) in the case of nonperformance. Basically, a Surety Bond, or Commercial Bond insures the hired party will perform or funds will be returned and losses covered.
To put it in bond, Surety Bond, language, a surety protects the obligee against losses if the principal does not meet their obligations. Further definitions to help you understand the language are: the obligee is the hiring party, the principal is the hired person or party, and the surety is the insurance company who guarantees that the obliging contractor can fulfill the obligation.
Let’s put it in first person: The obligee or hiring party is you. The principal or hired person is your contractor. The surety is the insurer.
Kelly Lee Insurance has access to over 50 independent underwriting sources, this means you can find the best value Surety Bonds for your business. Rates on Surety or Commercial Bonds are dependent on several factors including risk, type of business, and the cost of the project or work to be performed.
The business world can be complicated, the business world can be uncertain, however, with the issuance of a Surety Bond your project can find concrete footing in the case of an unforeseen impediment.
Surety Bonds are not applicable to every type of business. Surety Bonds may not be necessary or even obtainable for every situation that involves hiring a contractor to provide a service.
If you would like more information on Surety Bonds or Commercial Bonds in Lake Charles LA, call your local insurance agent Kelly Lee Insurance. They are than willing to have a no-obligation discussion about the protection this type of insurance affords your clients.
If Kelly Lee Insurance is your agent for auto, life, business, and/or home, then you know about the top-notch service their local staff provides on a daily basis. They are ready and willing to help make your business decisions and operations are sure as possible.
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