Fidelity Bonds provide insurance against loss from employee misconduct, such as theft or embezzlement, which is not otherwise covered by a company’s regular insurance coverage. A bond can provide blanket coverage for the actions of all employees or can be tailored to cover one or more specific employees as is the case with a Pension Fidelity Bond.
Surety Bonds are contracts involving three parties: (1) the party required to perform (called the principal), (2) the party for whom the work is being done (called the oblige), and (3) the party who insures the action of the principal (called the insured). If the principal fails to perform a job covered by the surety bond or otherwise causes damage or loss to the oblige, then the surety pays the bond amount to the oblige, who can then use the money to complete the job with another company.
Business Services Bonds
If you have employees working on a customer’s premises, this type of bond will provide coverage for employees’ fraudulent or dishonest acts. For example, if you have a cleaning service, this bond will reimburse you if your employee steals from a customer. You can then use the proceeds to reimburse your customer.
Fiduciary Bonds guarantee honest accounting and faithful performance of duties by administrators, trustees, guardians, executors and other fiduciaries. Fiduciary bonds are in some cases referred to as Probate Bonds.