Surety bonds are not insurance policies. Instead, surety bonds are guarantees. You or your business may be asked to obtain a surety bond to guarantee that you will:
- Honor a bid in a contract or agreement.
- Provide payment to contractors and subcontractors as specified in the contract.
- Follow through with your obligations under the contract or agreement.
- Perform ancillary tasks or requirements that are not part of the contract itself but that are material to it.
If you have a surety bond and fail to follow through with your obligations as specified, both you and the surety company will be jointly and severally liable, and either (or both) of you can be sued.
Surety bonds are required for federal construction contracts of $150,000 or greater. In addition, many private contracts and subcontracts, and contracts involving municipalities, counties, states or other public governments, may require surety bonds.
KORE Insurance Holdings’ Surety Bond Department provides services for all types of – and all aspects of – commercial and construction surety bonds. The services we can provide include:
- Working closely with our clients to develop surety bond submissions for underwriters to secure facilities to be covered under the surety bond.
- Negotiating terms and conditions of surety facilities. There is potentially a lot at stake in surety bonds, so it is important to negotiate terms our clients are comfortable with.
- Reviewing surety bonds and riders to confirm conformity to client requirements. We will help ensure the bonds and riders issued are what we – and you – expected to avoid any unpleasant surprises down the road.
- Executing surety bond documents. Once we have confirmed the bonds look correct, we will help you get them executed and in force.
- Advising on surety market conditions. Knowing what the surety marketplace looks like at any given time can help you understand and make wise decisions when entering into contracts that require surety bonding.