5832 W Camelback Rd ste 1, Glendale, AZ 85301, EE. UU.
(800) 380-1412

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What is a Surety Bond?

 The definition of Surety Bond:

A surety bond is an agreement between three parties: Principal, Surety and Obligee. The surety provides a financial guarantee to the obligee (i.e. government) that the principal (business owner) will fulfill their obligations.
A principal’s “obligations” could possibly mean complying with state laws and regulations pertaining to a specific business license, or meetings the terms of a construction contract, it all depends on the type of the surety bond.
If the principal fails to meet their agreed upon obligations with the obligee, the surety will be required to resolve the dispute by paying a claim to the obligee. It is in this sense that a surety bond is very similar to a form of credit extended to the principal by the surety.
Three parties involved in a surety guarantee:
PRINCIPAL: Person required to post bond.
OBLIGEE: Government entity or person requiring the principal to be bonded.
SURETY: Provides financial guarantee to obligee on behalf of a principal.
What does a surety bond guarantee?
For license & permit bonds, they make sure that a principal understands and follows the regulations outlined for their specific license. This is where the term “license & bonded” comes from. Examples of a license infraction could include fraud, misrepresentation, or late payment. If a covered violation causes a claim against the bond that the principal is incapable to resolve, the surety will be required to pay the claim to the obligee.
In the construction industry, surety bonds usually ensure that a bonded contractor will fulfill their obligations stated in a signed contract. If a bonded contractor defaults on the contract, the surety guarantees that the obligee will be made whole. This can include either a financial payout or taking other types of actions to make sure the work is achieved  per the terms of the contract.

What Bond Do I Need?

There are over 50,000 bonds in the U.S. and bond requirements, amounts and regulations are typically set at the state level.

Arizona Administrator and Executor Bond

We’ve got the bond you need

With more than 25,000 bonds available across all 50 states, our experts are sure to help you find the right bond for your needs. Call today, or get started online.

arizona surety bond

Learn from our experience

Whether you’re looking for a basic definition, wondering how rates are calculated or need your specific surety bond cost, you’ll find what you’re looking for on 1Bondsinsurance.com.

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5832 W Camelback Rd Ste 1,

Glendale, AZ 85301, EE. UU.

Phone:  (800) 380-1412

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