Surety bonds Guide, Meaning , Facts, Information and Description
The word bond refers to anything that binds, fastens, or restrains. Typically, it refers to binding agreement or covenant — a promise. Sometimes, it is enough to say that "My word is my bond." But often this kind of promise is cemented using a monetary or non-monetary "bond", as with those negotiated by bailbondsmen. Similarly, we see the institution of the surety bond.Many individual contractors are "bonded" in the sense that the quantity and quality of the work they do is guaranteed by a surety bond. In the words of the U.S. Small Business Administration, "A surety bond is a three-party instrument between a surety, the contractor and the project owner. The agreement binds the contractor to comply with the terms and conditions of a contract. If the contractor is unable to successfully perform the contract, the surety assumes the contractor's responsibilities and ensures that the project is completed."
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