Commercial surety bonds satisfy the security requirements of federal and/or provincial courts, government bodies, financial institutions, and private corporations and protect against financial risk. These bonds guarantee that the business or individual will comply with all required legal obligations.
For a consumer, this means that commercial surety bonds protect against fraud, misrepresentation, and compensation of monetary loss.
Commercial surety bonds can be used to guarantee performance of non-construction related contractual obligations. For example, companies that supply and install equipment. An organization may require a bond so not only does the supplier install the equipment, it will also service the equipment.
Commonly Used Commercial Surety Products
- Court Bonds
- Judicial Bonds; and
- Fiduciary Bonds.
- Customs & Excise Bonds
- License & Permit Bonds
- Lost Documents Bond
Industry Licensing Requirements
In Canada, surety bonds may only be issued by companies licensed to do so, either federally, or by one of the provincial insurance regulatory bodies. The requirements to obtain such a license are demanding and applicants are required to demonstrate financial solvency and sufficient strength to meet potential claims obligations. Only firms that are licensed to sell surety bonds in Canada may become members of the Surety Association of Canada.
Find out more about industry licensing requirements or for a list of provincial/territorial regulators.