Which bond application do you need for your specific bond? Our one page bond application suffices for most bond types under $100,000 and has been approved by multiple surety carriers.
A surety bond application is a form required by the surety carrier. It provides the basic information needed about the bond and the principal for the approval process. It also often serves as the legal contract between the surety carrier and the principal. The surety bond application is a different document than the surety bond form, which is used for the actual bond itself and is the contract between the bond principal and obligee.
Every surety carrier has their own surety bond application. Most even have different applications for different categories of bonds. Also, many surety bond brokers have their own bond applications that can be used in lieu of the surety carrier’s application. This permits the broker to save a principal time by completing just a single application, allowing them to shop the bond with multiple surety carriers.
Bond applications will include both the bond and the principal information needed to complete the bond form. For the bond, we need to know items such as the bond type, bond amount, obligee and effective date. The principal information consists of data such as the exact principal name to use on the bond form, address and phone number.
The application will also include information on who is indemnifying the bond and the place where those indemnifiers need to sign the application. For the business the indemnity information may include legal business name, FEIN, state of incorporation, address, etc. For personal indemnitors it may include legal name, social security number, residential address, spouse name, spouse SSN, etc.
Who has to sign the bond application depends on who the surety carrier requires to indemnify the bond in order to approve. The principal on the bond form — whether an individual or business — will always have to indemnify the bond. Additional signers/indemnitors can include the business owner(s), owner spouses, family trusts, etc. These signature may also need to be witnessed and/or notarized depending on the situation.
Once you sign a bond application, you may be required to provide the original. Today, most surety carriers for most bond types do not require you provide them with the original application. However, for riskier bond types and large single or aggregate bond amounts, you may still be required to provide an original. Physical signatures, scans and/or faxes are accepted by most surety carriers. Electronic signatures or pictures of a signed bond application are accepted by some.
In addition to the bond application, other information may be required for the bond approval process, known as underwriting. Whatever underwriting data is required, the surety is using the information to assess if this particular bond is a good risk for them.
If you need many bonds, a large single bond or a very risky bond, the surety will sometimes require you to execute a general indemnity agreement (GIA) instead of just a bond application. GIAs provide the same indemnity; they are just longer contracts with more details spelled out. One great benefit of GIAs is that principals who need numerous bonds save a lot of time, because they can execute a single document instead of multiple bond applications.
To learn more about how to apply for a bond, click here.
If you ever have a question, please simply call or email Alpha Surety. We are happy to make sure you know the correct application to use.