When looking at starting a new business you will need to get reputable bonds to be able to commence work on some projects.
A bond is a policy that allows your business to pay any parties that may suffer financial loss due to you not completing your work in a safe and legal manner or not complying with terms of your contract.
Of course, the actions of your employees are still your concern. The bond will only cover costs in the short term, you will have to repay any funds that your bond company doles out in accordance with your policy limitations as well as any legal fees that may have been incurred.
There have been issues in the recent past where businesses have bought bond policies from fraudulent companies. There is documentation on the FBI website to help you understand the steps in making sure that you are not being scammed.
It is important to get reputable bonds from reputable companies to ensure that you are fully protected. The SFAA, or Surety and Fidelity Association of America has a number of credible companies that work with them to ensure that bonds are written and used in a legal manner. If you are asked to sign a bond, you may wish to seek advice from the SFAA if you are unsure about any part of your bond documentation. The SFAA will also be able to check that your bond is coming from a reputable and licensed company so that you can feel safe in the knowledge that your bond is going to help you should anything go wrong.
When making an enquiry to any of the companies on the SFAA surety authentication list, you will need to include as much information as possible including names, addresses, dates and costs associated with the bond, as well as your personal company information and a brief but detailed description of the job that you are applying to complete. The simplest way for you to be able to give all this information is to enclose a copy of the bond with your application for authentication.
State insurance companies are able to give licenses to surety bond brokers, so rather than go through the process to apply to the Surety and Fidelity Association of America; you may choose to speak to the insurance company that has licensed the broker about your concerns. The broker should give you details about where their license comes from, whether they have acquired their own or whether they are tied to a larger company. Finding the company that has licensed the broker is not hard; you should have no problem finding them using your internet search browser or your telephone directory. If the broker that has produced your bond is not licensed by a larger company and you would like to make sure that all parts of your bond are legal and correct, you will have to apply to the SFAA.
Reputable bonds from large and reputable companies ensure that you are given the best chance at getting your license or contract position. You should always use a bond broker that is a leader in the industry wherever possible.