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Texas Utility Bond

Before you can access utilities in Texas like electricity, gas, and water, you may need to get a Texas utility bond. Learn how everything works with this specific type of surety bond.

What is a Texas Utility Bond?

Like other kinds of surety bonds, a Texas utility bond holds someone financially liable if they don't abide by the terms of an agreement; in this case an agreement to pay their utility bills on time and in full. Bonds make utility customers accountable for the bills they fail to pay. They also provide a guaranteed mechanism for utility companies to recoup their losses from unpaid bills.

How does a Texas Utility Bond work?

When someone fails to pay their utility bill, the utility company has the right to file a claim for compensation against the Texas utility bond. The company that issues the bond will then pay the claim, but that doesn't settle the debt - it transfers it from the utility company to the bond company. The bonded party (the utility customer) must pay the surety bond company back any amount it pays out in claims.

Who should get a Utility Bond in Texas?

Texas utility companies have a right to request a bond of anyone, but they typically limit the requirement to just two groups of customers. First, people with a history of late or unpaid utility bills. Second, commercial customers who may be running up huge utility bills on a monthly basis. Customers must prove they have the required bond before a utility will turn on service, so it's imperative to seek out a utility bond in Texas ASAP.

Who are the parties involved in a Texas Utility Surety Bond?

The bond agreement involves three equal and distinct parties:

• Principal - The utility customer required to get a bond and also required to pay for any claims.
• Obligee - The utility company with the right to file claims against the bond seeking compensation for unpaid utility bills.
• Surety - The company that issues and backs the bond. The surety guarantees payment to the obligee, but the principal must pay the surety back in full with interest and fees added to the debt.

How much does a Texas Utility Bond cost?

The cost (called the bond premium) is different for every person. It depends on the size of the bond, which is up to the utility company that sets the bond requirement. The premium is a small percentage of the total bond size. What percentage depends on the bond applicant's credit score and financial history. Applicants with low credit scores or blemishes on their record will pay more, but with the help of Viking Bond Service, bad credit doesn't have to disqualify someone from getting a utility bond in Texas.

How are claims handled for Texas Utility Bonds?

The surety is a neutral party. It does not assume a claim is true. Instead, it investigates the details of the claim and only issues payment once everything is verified. Since the bonded party has financial responsibility for all claims, that person must pay the surety back. The bonded party must also pay interest and fees whenever the surety steps up to settle claims.

How to apply for a Texas Utility Bond?

Simply fill out a bond application, supply a copy of the bond requirements, and turn over any documents the surety requests. When you apply with Viking Bond Service, the process takes just minutes, and you can expect to get a quote for the premium price back in only 24 hours.

Viking Bond Service - Making Texas Utility Bonds Easy

Don't let a bond requirement keep you from getting essential utilities. Fill out this online bond application to get the process started immediately. Or get more information first - call us at 1-888-278-7389 or fill out the contact form on this page.