Surety bonds
Contractor License, Bid, and Performance Bonds
A surety bond is not an insurance policy. It is a three-party guarantee: the surety guarantees to the obligee (such as a licensing board or project owner) that you, the principal, will meet an obligation. If the surety pays a valid claim, you are generally expected to repay the surety.
Request bond helpBonds are not insurance
Insurance is designed to protect your business from covered losses. A surety bond protects the obligee and guarantees your performance of an obligation; if the surety pays a claim, you are generally required to repay it. A bond does not replace general liability or any other policy.
What bonds are used for
Subject to the actual policy or bond form, its terms, limits, and exclusions.
- License and permit bonds that a state, county, or city may require before you can work.
- Bid bonds, performance bonds, and payment bonds for public and some private projects.
- Understanding what a surety typically reviews, such as credit, financial statements, and work history.
Keep in mind
- A bond protects the obligee, not your business. It does not replace general liability or any other insurance.
- Bond approval depends on the surety's underwriting. Larger contract bonds often require financial statements.
- Indemnity agreements are standard — you are responsible for repaying claims the surety pays.
Questions we'll review with you
- Which bond type and amount does the obligee require?
- Who is the obligee, and is there a required bond form?
- For contract bonds, what is the contract size and your work history on similar jobs?
Coverage availability, eligibility, limits, and pricing are subject to underwriting and policy terms. Requesting a quote does not bind coverage.
Ready to review your coverage?
Tell us about your business. A KTL agent will review your information and follow up about available options.