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Suppose a local USA Authority. These bonds are required before a court proceeding. It provides protection. Let’s say that you’re an entrepreneurwho hires a contractor to build you a brand new space for your employees because you’ve outgrown your old facility.
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In this example, the entrepreneur plays the role of the obligee , or the person or group who wants a service or project done. A surety bond is basically an insurance policy on a contract. For example, if Party A agrees to perform a contract for Party B, Party B could require a surety bond.
If Party A does not perform on the contract, Party B will collect the. Large corporations, government agencies, and municipalities almost always require a surety bond before agreeing to do business with a company. Some state laws and regulations require certain business types to carry bonds as well.
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For example, in many states you must have commercial and fidelity surety bonds to run an auto dealership. A popular example from the license bonds category is that of auto dealer bonds. For instance, health insurance protects your health by paying for a portion of your health care if you need it. Surety bond examples Auto Dealer Bonds.
In the same way, surety bonds protect the public by paying for damages if needed. Customs bonds, including importer entry bonds, which assure compliance with all relevant laws, as well as payment of. (more…)