"Your Word, Backed By a Promise That Holds."
Financial guarantees that build trust and credibility
Surety bonds provide a financial guarantee that contractual obligations, legal requirements, or professional standards will be fulfilled. Unlike insurance, which transfers risk, a surety bond is a three-party agreement designed to protect the party requiring the bond.
Surety bonds are often required by law, contract, or regulation — and can be critical to doing business.
How Surety Bonds Work
A surety bond involves three parties:
Principal — The business or individual required to obtain the bond.
Obligee — The party requiring the bond, such as a government entity or project owner.
Surety — The company that issues the bond and guarantees the principal’s obligation.
If the principal fails to meet the bonded obligation, the surety may pay a valid claim — and the principal is typically required to reimburse the surety.
Common Types of Surety Bonds
Surety bonds are used across many industries and may include:
License & Permit Bonds — Required by governments to ensure compliance with laws and regulations.
Contract BondsIncluding bid bonds, performance bonds, and payment bonds for construction projects.
Commercial Bonds — Such as fiduciary bonds, court bonds, and miscellaneous compliance bonds.
Financial Guarantee BondsEnsuring financial obligations are fulfilled under specific agreements.
Bond requirements vary widely by industry and jurisdiction.
What Surety Bonds Do Not Do
Surety bonds are not insurance policies and do not:
Protect the bonded business from its own losses
Cover poor workmanship or financial mismanagement
Replace contractual responsibility
Eliminate liability for non-performance
The principal remains ultimately responsible for meeting obligations.
Who Needs Surety Bonds?
Surety bonds are commonly required for:
Contractors and subcontractors
Real estate professionals
Freight brokers and transportation companies
Financial service providers
Court-appointed fiduciaries
Businesses operating under government licenses
Many businesses cannot legally operate or bid on projects without required bonds.
How Bonds Are Underwritten
Surety bonds are underwritten based on:
Financial strength and creditworthiness
Industry experience
Contract terms and scope
Prior bonding history
Unlike insurance, surety underwriting focuses on the principal’s ability to perform and repay.
Why Proper Placement Matters
Surety bonds vary by:
Bond form and language
Obligee requirements
Jurisdictional rules
Financial underwriting standards
Incorrect bond placement can delay projects, licensing, or contract approval.
Our Approach
At Cory Washington & Co., we streamline the bonding process while ensuring accuracy and compliance. We work with reputable sureties to help clients meet requirements efficiently and position themselves for future growth.
Bonding is about credibility — and getting it right matters.
Disclaimer
All insurance descriptions on this website are provided by Cory Washington & Co. LLC strictly for general informational purposes. They are not intended to be, and should not be relied upon as, legal, financial, or insurance advice. The information presented is general in nature and does not guarantee the availability, terms, conditions, or scope of any insurance coverage. Actual coverage is determined solely by the specific policy language issued by the insurer and remains subject to underwriting approval. Nothing on this website creates or implies an agent-client relationship, binds coverage, or alters any existing policy. Cory Washington & Co. LLC expressly disclaims any liability for actions taken, or not taken, based on the content provided here. For advice regarding your particular situation, please consult directly with a licensed insurance professional at Cory Washington & Co. LLC or another qualified insurance professional, and always review your policy documents in full.
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