Philadelphia Surety Bonds | Pinnacle Surety Bonds
License and Permit
These bonds are required
of those who must obtain licenses or permits from cities, towns, or political
subdivisions before they can proceed with various activities. These bonds,
although used for a variety of purposes, usually guarantee that the persons
who post them will comply with statutes, regulations or ordinances that
regulate their activities. An operator of a liquor store, for example,
may have to post such a bond guaranteeing that liquor will be sold in strict
compliance with alcoholic beverage control laws. Electricians and plumbers
also must post these bonds guaranteeing that their work will conform to
the specifications of a given building code.
There are two broad classifications
of license and permit bonds:
A license or permit bond carries
a term that corresponds with the period covered by the license or permit
issued to the principal. The right to file a claim under the bond continues
for varying periods, depending upon the state in which it was issued. Termination
of a license or permit bond depends upon the following:
Those that indemnify a governmental
body for the principalís failure to comply with an applicable law.
Those that give a third party
the right to pursue the principal -- in the third partyís own name -- for
loss or damage incurred by that third party due to the default of the principal.
whether or not termination is
allowed by law;
the ordinance under which the
bond is required;
the terms of the bond itself.