Quick answer
A surety bond guarantees to a third party, such as a project owner, licensing board or local government, that your business will meet its obligations. It isn't insurance for you: if the surety pays a valid claim, you repay it. You pay a premium that's a percentage of the bond amount, set mostly by your credit and finances. Fidelity bonds protect a business against employee theft.
Coverage Overview
A surety bond isn't insurance in the usual sense - it's a three-party guarantee, and understanding that difference matters before you're asked to post one for a contract, license, or permit.
Common bond types we help place
- Contract bonds - bid bonds, performance bonds, and payment bonds required to bid on and complete construction contracts
- License & permit bonds - required by Florida state licensing boards and local municipalities before you can operate in certain trades
- Fidelity/crime bonds - protect a business against theft or embezzlement by an employee
Commercial Bonds FAQ
What's the difference between a surety bond and insurance?
Insurance pays a covered claim and the insurer absorbs the loss. A surety bond guarantees your performance to a third party (like a client or licensing board) - if a valid claim is paid out, you're contractually obligated to reimburse the surety company. It protects the party you're bonded to, not you.
What bonds does Florida require for my contractor license?
Requirements vary by license type and local jurisdiction, but many Florida contractor licenses and permits require a license bond as a condition of registration - we'll confirm exactly what your specific license and county require.
How much does a bond cost compared to its full bond amount?
You typically pay a small percentage of the total bond amount as your premium - the bond amount itself is the guarantee ceiling, not the cost. Your rate depends on your credit and financial history, since the surety is underwriting your ability to reimburse them if a claim is paid.
What it usually doesn't cover
- Your own losses. A surety bond protects the party you're bonded to.
- Claim payments, which you repay to the surety.
- Liability for injuries and property damage. General liability insurance →
Every policy is different. Your declarations page and policy form decide what's covered.
Have this ready before you ask for a quote
- The bond type and amount, and who's asking for it (the obligee)
- The requirement in writing: the contract, license rule or permit form
- Business and owners' legal names and addresses
- For contract bonds: financial statements and work history
- The date you need it
Don't have everything? Send what you have; an agent will ask for the rest. Coverage can't be bound or changed through this website.