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Surety Bonds in Connecticut

If you live in Connecticut and need to fulfill a surety bond requirement, you have two priorities. First, act fast, because it's always better to comply with these requirements sooner rather than later. Second, get informed, because it's vital to understand what bond agreements involve before signing. Read on to learn everything you should know.

How Does a Surety Bond in Connecticut Work?

All surety bond types involve three parties: the principal (the bondholder), the obligee (the bond beneficiary), and the surety (the bond underwriter). The obligee may file claims against the bond seeking compensation for damages caused by the principal due to illegal, unethical, or otherwise unacceptable behaviors. The surety guarantees to settle claims in full after conducting an investigation to evaluate their merit. After paying, however, the surety will collect the claim amount – plus interest and fees – from the principal who has the liability for it under the bond agreement. If a principal does not repay the surety, it could result in lawsuits or debts sent to collections.

Types of Surety Bonds in Connecticut

There are hundreds of different surety bond types, most with unique, state-specific requirements. However, the vast majority of surety bonds will fall into one of these four categories:

• Commercial – Surety bonds to obtain a professional or business license.
• Contract – Surety bonds to finalize a contract, often between contractors and a client.
• Court – Surety bonds a judge requires before proceeding with a trial.
• Fidelity – Surety bonds that a business obtains (voluntarily) to protect themselves and clients from employee misconduct.

Who Needs a Surety Bond in Connecticut?

Many people across Connecticut need surety bonds. That long list includes some people opening a small business or starting a professional career based in Connecticut. Large numbers of contractors and construction companies should prepare to get commercial and contractor bonds as well. Someone who gets involved in legal proceedings may also need to get a bond.

In general, any situation where one party needs to not just trust another party but enforce upstanding behavior may involve a surety bond agreement. To that end, anyone in Connecticut may need one at some point.

How to Get a Surety Bond in Connecticut

The exact process to obtain a surety bond will depend on the specific type of bond and the coverage amount (the maximum amount the surety will pay to settle claims). Though the specifics may vary, getting a Connecticut surety bond usually involves these steps:

• Fill out a bond application. Business partner's information will be required on applications as well.
• Undergo a credit check.
• Supply any documentation. That may include a copy of the bond requirements or a financial statement.
• Receive a quote for the bond price. The cost of a surety bond is unique to each individual and based on the info from the previous three steps.
• Pay the bond premium. Payment usually activates coverage for 12 months, but longer and shorter terms are both possible.
• Get proof-of-coverage documents. These documents prove someone met the surety bond requirements created by the obligee.

The Cost of Connecticut Surety Bonds

Bond premiums are, in most cases, a small percentage of the bond's total coverage amount. For example, a surety bond with $10,000 in coverage may only cost a few hundred dollars. Someone will pay less or more for a surety bond based on their credit, and bad credit may make it harder to get approved.

Do You Need to Renew Surety Bonds in Connecticut?

Some bonds, like commercial bonds, will need to be renewed, usually on an annual basis. The surety company will run an updated credit check at renewal time and take another look at the bondholder's financial standing. Any changes since the last renewal will be reflected in the renewal cost. Improving credit will lower the cost, whereas declining credit will do the opposite.

Viking Bond Service – All Bonds in Connecticut

If you need a surety bond in Connecticut, Viking Bond Service is here to help. With our easy application process, competitive bond rates, service-oriented team, and years of industry experience, we offer everything you could want in a bond partner. It's no wonder why people across Connecticut rely on us to help them get their first surety bond (and every bond thereafter)! See what a bond would cost – at no obligation – by requesting a free quote at your convenience. We fulfill most requests in under 24 hours. Have any questions? Contact us or call 1-888-2-SURETY (1-888-278-7389).