It's common knowledge that you need commercial insurance policies provided by companies such as Aegis General to protect your employees, business equipment and other important parts of your company, but did you know that surety bonds are also important? A surety bond is a guarantee that specific tasks are fulfilled. Surety insurance is most common in relation to government contracts, but many people will also seek a bond in order to be licensed, and sometimes businesses buy surety insurance to protect against employee theft.
Typically, three people enter into a surety contract. They are the principal, which is the business that purchases the bond, the obligee, which is the contractor performing the work, and the surety, which is the insurance company backing the bond. You should purchase a surety bond if you are operating a Federal construction contract with a value of $150,000 or more, and keep in mind that many service and supply contracts will also require a surety bond. State and local governments have surety bond laws you must meet, too, so be sure to check with the proper government departments before beginning any work. You can find out more about your specific needs regarding surety bonds by speaking to a professional insurance provider such as Aegis General.