How do I become bonded in NC?
Answers:
If your type of business requires a license bond (i.e. contractor, motor vehicle dealer, notary, tax preparer, etc.), then you would need to apply for the amount and specific type of bond required. These bonds usually require credit and experience to support the amount of the bond. One site that can write these bonds even with poor credit is: http://www.southcoastsurety.com...
A bond for general business is usually a fidelity bond. These are written as instant issue bonds. They are relatively inexpensive. This bond protects your customers from theft by your employees.
This fidelity (Business Services) bond is very similar to insurance. It protects your clients in the event an employee is arrested and convicted for stealing from them. You will not be expected to cover the loss.
The annual premium rates are based upon the number of employees and the amount of coverage. They range from a $100 for a $5000 bond with less than 5 employees to $800 for a $100,000 with 25 employees less than .
These instant issue bonds are readily available on the internet or through your local insurance agent. You can run a Google search for Janitorial Bond and find a site that has on line submissions. One of those sites processing on line applications is http://www.southcoastsurety.com...
You can get more information on this bond and a link to the application at http://southcoastsurety.com/fidelity-bon...
Contact a bonding company.
Sort of. Insurance companies issue bonds, how's that. It works a bit differently.
Contact the guy that writes your house and car insurance. If he can't do it, he can refer you to someone local who can.
If it's a professional bond, like a notary bond, or public official bond, the city might have a referral for you.
DO NOT try to get this over the internet, they need LOTS AND LOTS of personal information from you, so you don't want to be sending it to someone you can't track down afterwards.
Bonding is different than normal insurance in that you are expected to fully indemnify the bond company.
For example, if your house catches on fire and burns to the ground, the insurance company is going to indemnify you by writing a check to replace the home.
If you suffer a bonding loss, the insurance carrier will pay for the loss but you are expected to repay the insurance carrier.
This makes the underwriting very different from underwriting other property and casualty risks. They will require financial statements and usually, if you are not significantly cash liquid and rich, a personal guaranty from you , your spouse and your partners and their spouses. The process can take a significant amount of time.
A common mistake that people make however is to not go through the underwriting process thinking they will take care of it if they are actually going to be required to place a bond. At that point it is generally too late because of deadlines for bid bond applications. You need to be ready to roll when the opportunity arises. If you try to do the underwiting process after you have the opportunity to do a bonded job you are most likely not going to have time to get underwritten before your bid bond deadline.
What kind of bond do you need? If you are in the Greensboro/Winston Salem area contact me.
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