The surety investigates, pays the obligee if the claim is valid, and then looks to you for the money. That is the part that separates a bond from insurance. You signed an indemnity agreement, so a paid claim becomes a debt you owe the surety, often including its costs. On a CSLB license bond there is a second consequence: a claim paid against the bond can affect the license itself, and the bond must be restored to full value. Tell us as soon as a claim is threatened, not after it is paid.
Related FAQs
No. Fidelity is crime coverage for employee theft, which we handle separately.
A bid bond backs your bid, a performance bond backs your completion of the work, and a payment bond backs payment to subs and suppliers.
No. It guarantees your obligation to the obligee. If the surety pays a claim, you are expected to repay it.
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