A surety bond claim occurs when the principal on a surety bond does not fulfill their obligations agreed to within the bond language and the surety bond obligee claims the principal has defaulted on the surety bond.
This means the surety bond company will pay the obligee up to the full amount of the bond value. If a default occurs and a claim is made, the surety bond company will seek indemnification from the principal.
For example, fidelity surety bonds can be written to protect employers from theft, such as the employee dishonesty surety bond. If the employee (the principal) steals from their employer (the obligee), they have defaulted on the surety bond. If a claim is made by the employer, the surety bond company will have to pay the employer up to the full amount of the bond value. The surety bond company will then seek to be indemnified by the employee.