Surety Bonds in California
Viking Bond Service is one of the leading CA surety bond companies. We offer a quick and easy way to get a surety bond in California for you or your business.
Our team consists of surety bond experts who have many years of experience helping businesses get surety bonds at affordable prices. California state regulations often require businesses to have surety bonds such as contract and commercial bonds. Viking Bond Service can ensure that you have the bond you need to comply with state laws.
What is a Surety Bond in California?
A surety bond in California is a financial agreement between three parties:
- The Principal - The party that obtains the surety bond. The principal takes financial responsibility for all valid claims filed against the surety bond.
- The Obligee - The party that requires the surety bond. The obligee may file claims for damages against the bond if the requirements aren't met.
- The Surety - The party that issues and backs the surety bond. The surety will settle claims when the principal can't or won't, but that debt must be repaid with interest and fees added.
How Does a Surety Bond in California Work?
Viking Bond Service is your source for all surety bonds. Our application process is quick and easy, and our team is committed to getting you approved as quickly as possible. We are equally committed to helping all applicants – regardless of credit status – get the legally required surety bonds they need to begin building a successful business.
The exact process varies with different types of surety bonds but generally works like this:
- Someone must meet CA surety bond requirements, so they obtain a surety bond in the correct amount.
- The bondholder does something illegal, unethical, or otherwise prohibited under the bond agreement, resulting in damages.
- A claim is filed against the surety bond for compensation equal to those damages.
- The surety agency investigates the claim thoroughly to verify or disprove the details.
- After proving the claim is valid, the surety automatically settles it in full.
- The bondholder pays the settlement amount (plus interest and fees) back to the surety. Otherwise, the debt enters collection.
California Construction Bond
Construction projects in California often require contractors to obtain specific types of surety bonds before they're awarded a bid or allowed to start any work. If you're involved with construction in any way, it's critical to know when, where, why, and how surety bond requirements affect your business.
What is a Construction Bond in California?
To start, it's a form of contract bond. All contact bonds hold the bonded party (in this case the contractor performing the construction work) responsible if he or she fails to meet the terms of the contract. Many construction contracts include a bond requirement as a way to hold contractors responsible for their actions and ensure the other parties in the contract can seek justice in the form of financial compensation.
What Are the Types Of California Surety Bonds?
There are many types of surety bonds required in California, and the three main categories are:
Contract Bonds – Contract bonds hold one party in a contractual agreement responsible if they don't meet terms established by another party. This type of California surety bond is often required for construction projects, but they can factor into other contractual arrangements. Since contract bonds facilitate the smooth execution of a contract – and hold the wrongful party accountable when things don't go smoothly – they're one of the most common types of surety bonds.
Commercial Bonds – Also known as license bonds, many businesses and professionals need commercial bonds before the state recognizes them as a legal business entity. Typically, someone needs to obtain a commercial bond before the state will grant them a license. States use commercial bond requirements to ensure that professionals abide by legal and ethical behavior, and face accountability when they don't.
Court Bonds – A judge may require someone to obtain a court bond before allowing legal proceedings to move forward. The court bond holds the bonded party financially liable if they fail to act in a manner required by the court. Court bonds are most common in civil cases.
Besides those, some of the common surety bond types in California include:
- Auto dealer bonds allow you to obtain a license and legally operate your dealership/sell vehicles.
- Bid bonds allow one to bid on bonded jobs.
- Freight broker bonds allow you to legally operate as a freight broker and obtain your authority from the FMCSA.
- Performance & payment bonds allow you to perform work on a project once you are awarded the job.
Who Needs a Surety Bond in California?
Businesses, professionals, and individuals may all need CA surety bonds for various reasons. Surety bonds are often required to obtain a license, finalize a contract, initiate a service agreement, or advance legal proceedings. Some people need surety bonds once while others need them regularly or continuously.
If you need assistance, Viking Bond Service is here to help make sense of any California surety bond requirements. You can contact us for helpful information at no cost.
How to Obtain a Surety Bond in California
The California bonding process starts with an application to a bonding company such as Viking Bond Service. The application process will vary depending on the required bond. For simple bonds like commercial licenses and permit bonds, you can use our online form to complete the application process.
If you need a contract performance bond, one of our agents will work through the process with you. To complete the application process, supporting documentation that outlines your business experience and credit history may be needed. This information is used to provide an accurate quote for your bond and to complete the underwriting process.
How Much Will a Surety Bond in California Cost?
Viking Bond Service will calculate the premium cost of your surety bond using the information in your application and supporting documents. There are numerous factors that influence the cost of your surety bond, including the bond amount, type of bond, and your financial and business history.
The premium is determined based on the risk factor of issuing the bond. Businesses with a poor credit history or less experience are deemed as posing a higher risk. This means that people with strong credit scores often pay less for a bond.
Viking Bond Service aims to provide a bond quote on the same day that the application is received and can help everyone, even those with a low credit score, get the bond they need.
How to Renew Surety Bonds in California
Renewal of surety bonds is an important matter, especially for people who require a surety bond before they can obtain a professional license. They will need to keep that bond active and in good standing at all times, and any lapse in surety bond coverage (most remain active for 12 months) will invalidate the professional license and make all future work illegal.
The process of renewal involves submitting to a new credit check and completing an updated application. The renewal cost will be similar to the initial premium, but it could be less or more depending on any changes to credit standing.
Viking Bond Service goes above and beyond to make renewing surety bonds a seamless process. We provide plenty of advanced notice, along with a speedy renewal review. Don't let lapsed bond coverage cause preventable problems.
Common Surety Bonds in California
Viking Bond Service's producers are experts in all types of surety bonds in California. We can provide expert advice and bonding services for all categories of surety bonds, including both commercial and contract bonds.
Two of the common commercial bonds in California are fuel tax bonds and title bonds. Commercial bonds, which are often a state requirement, are also known as license and permit bonds, as they are needed for specific business license applications.
A contract bond provides a guarantee that the services outlined in a contract will be completed. They are often used in the construction industry to protect the parties in a contract by providing a financial form of recompense should the contract terms not be completed to the required standard. Contract bonds common in California include warranty and maintenance bonds, payment bonds, and bid bonds.
California Surety Bonds by Viking Bond Service
Viking Bond Service can help you find a CA surety bond at an affordable price. Our exemplary customer service and knowledgeable staff make us one of the premier surety bond companies in California. For a quick quote, call, email, or use our online form to start your surety bond application. We're here to help.
Request a Surety Bond Quote:
You can complete our online application at any time to receive a quick quote. For more information about Viking Bond Service, call us at 1-888-2-SURETY (1-888-278-7389) or contact us in writing.
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