Do you Need a Bond For your License or Permit (Northridge)

license info: CA Department of Insurance 0L85357
Bankruptcy Trustee Bonds
Bonds which provide protection to the beneficiaries of the bankruptcy action that the bonded trustees, appointed in a bankruptcy proceeding, will perform their duties and handle the affairs according to the rulings of the court.
Common types of bankruptcies are:
Chapter 7: calls for the "liquidation" of a business and allows for the sale of the assets to pay outstanding debts.
Chapter 11: calls for the "reorganization" of a business and the debtor remains in possession of the assets after the filing of a plan for the reorganization.
Bid or Proposal Bonds
These bonds are used by owners to pre-qualify contractors submitting proposals on contracts. The coverage provided by a Bid or Proposal Bond is that the bidder, if awarded the contract within the time stipulated, will enter into the contract and furnish the prescribed Performance & Payment Bond(s). Default will ordinarily result in liability of the surety not to exceed the dollar value set forth in the bond for the difference between the amount of the principal's bid and the next low bidder who can qualify for the contract.

Commercial Bonds
A general classification of bonds that refers to all bonds other than contract and performance bonds. Commercial bonds cover obligations typically required by law or regulation. Each bond is unique to the circumstances at hand.

Commercial Blanket Bonds
These bonds provide a single amount of coverage to cover dishonest acts of employees, regardless of the number of employees involved in the loss. In other words, this type of bond covers all employees to the amount stated on the bond.
A person, official, or entity designated to take over and protect the interest of an incompetent or minor.
Contract Bonds
A general classification of bonds that provide financial security and construction assurance on building and construction projects by assuring the project owner (obligee) that the contractor (principal) will perform the work and pay certain subcontractors, laborers, and material suppliers.
Court and Probate Bonds
Judicial and probate bonds, also referred to as fiduciary bonds, secure the performance on fiduciaries' duties and compliance with court order, e.g. administrators, executors, guardians, trustees of a will, liquidators, receivers, and masters. Judicial proceedings court bonds include injunction, appeal, indemnity to sheriff, mechanic's lien, attachment, replevin, and admiralty.

Errors and Omissions Insurance
A policy that provides coverage for an insured in the event of unintentional mistakes. Errors and Omissions Insurance, commonly referred to as E&O, covers damages arising out of the insured's negligence, mistakes, or failure to take appropriate action in the performance of business or professional duties.

Fidelity Bonds
Bonds designed to protect against dishonesty. Generally, the bond protects against dishonesty of employees. These bonds cover losses arising from employee dishonesty and indemnify the principal for losses caused by the dishonest actions of its employees.

One who is appointed to act in the best interests of another. A fiduciary is a person or entity appointed by the court to handle the affairs of persons who are not able to do so themselves. Fiduciaries are often requested to furnish a bond to protect against a lack of faithful performance of their duties.

Fiduciary Bonds
Bonds which protect against dishonest accountings and a lack of faithful performance of duties by administrators, trustees, guardians, executors, and other fiduciaries. Fiduciary bonds, often referred to as probate bonds, are required by statutes, courts, or legal documents for the protection of those on whose behalf a fiduciary acts. They are needed under a variety of circumstances, including the administration of an estate and the management of affairs of a trust or a ward.

License and Permit Bonds
License and Permit Bonds are required to obtain a license or permit in many cities, counties, states or other political subdivisions. They may be required for a number of reasons, including the payment of certain taxes and fees or providing consumer protection as a condition to granting licenses related to selling things such as motor vehicles or contracting services.

Maintenance Bonds
The normal coverage provided by a Maintenance Bond is a guarantee against defective workmanship or materials for a specified period of time after a project is completed. Maintenance periods range from one to several years; however, the standard is one year.

Miscellaneous Bonds
Miscellaneous Bonds cover performance of contracts and agreements with private parties and government agencies. e.g. lost securities, utility deposit, wages and welfare.

Notary Public Bonds
Include bonds that are required by statutes to protect against losses resulting from the improper actions of notaries.
Performance Bonds
The coverage provided by a Performance Bond is that the principal will faithfully perform the terms and conditions of a written contract. These bonds frequently incorporate payment bond (labor and materials) and maintenance bond liability. This protects the owner from financial loss should the contractor fail to perform the contract in accordance with its terms and conditions.

Reclamation Bonds
A bond which provides protection in the event that a person or entity does not restore land, that it has mined or otherwise altered, to its original condition.

Supply Bonds
Supply Bonds guarantee performance of a contract to furnish supplies or materials. In the event of a default by the supplier, the surety indemnifies the purchaser of the supplies against the resulting loss.

A person or entity which covers the acts of another.

Surety Bonds
Surety bonds are three-party agreements in which the issuer of the bond (the surety) joins with the second party (the principal) in providing protection to a third party (the obligee) regarding fulfillment of an obligation on the part of the principal. An obligee is the party (person, corporation or government agency) to whom a bond is given. The obligee is also the party protected by the bond against loss.

Surety Industry
The surety industry is composed of contract surety business and commercial surety business. The products comprising each are sold through the same type of distribution system - agents and brokers.

Workers' Compensation Self-Insurers Bond
Workers' Compensation laws, at the state and federal level, require employers to compensate employees injured on the job. An employer may comply with these laws by purchasing insurance or self insuring by posting a workers' compensation bond to guarantee payment of benefits to employees. This is a hazardous class of commercial surety bond because of its "long-tail" exposure and potential cumulative liability. The "long-tail" exposure stems from the two statutory bond forms:

post id: 7758128528


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