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You’ve been told you need to post a bond, but you’re not
quite sure exactly what that means. Where and how do you go about obtaining this bond?
The following is a brief explanation of what a surety bond is.
(You may click on the linked word, or phrase to see the definition.)
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A contract of Suretyship, commonly known as a
Surety Bond, is like a policy of insurance,
in that it provides indemnity to the
obligee
– as a policy of insurance provides indemnity to the insured – against loss up to a specified
amount resulting from the happening of a named contingency. The contingency insured against,
however, is not an event, such as death, fire or accident, but the failure of the
principal to perform or fulfill the prescribed
obligation or undertaking.
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There is a need for Suretyship whenever an
office, position of trust, contract, license or other right or privilege is offered
conditioned that the one to whom the grant is made will perform the obligations he has
assumed.
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In the case of a Public Official the law
requires, in order to qualify, a bond be posted from a qualified
Surety
for the faithful performance of his duties.
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In the case of a Fiduciary bond where one has
been appointed to a position of trust to be administered under the jurisdiction of a
court, such as executor, administrator, guardian, trustee or receiver, the law requires
that a bond be posted for the faithful performance of his duties.
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In the case of a Judicial Proceeding where a
litigant is allowed to have a particular remedy in advance of a final decision by the
court, a bond must be posted to protect the opposing litigant from loss in case the final
decision is adverse to the other litigant.
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In the case of a License and Permit bond
where one is granted a license to engage in a particular business, that privilege is
granted conditioned upon him filing a bond guaranteeing compliance with the statutes
governing the license.
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| | Atlynx Surety Brokers, LLC.
777 Zeckendorf Blvd.
Garden City, NY 11530-2127
Phone: 516-745-7520
Fax: 516-794-0380 | ©1999-2007 Atlynx Surety Brokers, LLC.
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