A Surety Bond Term is the time period for which a surety bond is valid and enforceable. It is the time frame during which surety bond companies, in exchange for the premium collected, take on the risk of the surety bond.
Bond terms can vary between surety companies and types of surety bonds. Most bond terms are stated in a specific number of years but some surety bonds may have non-renewable or continued until cancelled terms. Before the term ends on a renewable surety bond, the surety company may offer to extend the term for additional premium after going through a surety bond renewal process.
For example, a contractor license bond may have a bond term of one, two, three or four years, depending on the surety company, and may be renewed at the end of the term. A sweepstakes bond is a non-renewable bond whose term is set by the length of the promotion.