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Bond Amount/Penalty:

The bond amount, or penalty, is the monetary amount the surety is liable for in a surety bond agreement. In the instance of a valid claim on the bond, the surety would be liable for payment up to the penalty amount.

Bond penalty amounts are typically set by the party requiring the principal to be bonded. The penalty amount is typically representative of an amount considered sufficient to cover potential losses to the obligee or any fees due for violations to laws, rules or regulations.

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