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What is a Business Service Surety Bond?

A Business Service Surety Bond seeks to safeguard the property of you clients when entering their home or place of business. The Business Service Surety Bond gives your clients a form of assurance that they will be repaid if your employee steals their property.

A Business Service Surety Bond is not a Fidelity Bond

A common misconception about business service bonds is that they are the same as a fidelity bond. Business service bonds protect the bonded entity’s clients from theft by employees of the bonded entity. Fidelity bonds may also protect the bonded entity’s clients against theft but only if third-party protection is offered in the policy form.  Fidelity bonds are primarily a first-party policy meaning if a bonded entity’s employee steals from the company, the bonded entity may submit a claim on the fidelity policy and will be reimbursed for that claim less the associated deductible, up to the policy limit, and subject to being a covered loss.  A business service bond is a third-party policy where the bonded entity’s clients can claim on the bond in the event of theft caused by the bonded entity’s employee.  In the case of a covered claim, the business service bond would pay for the stolen property subject to the penal sum of the bond and the provisions in the bond the form.  The bonded entity is then responsible to reimburse the surety company for all expenses incurred for payment of the claim.  However, there are specific fidelity policies called third party crime insurance which covers one particular bonded entity’s client only.

What is the current market for a Business Service Surety Bond?

Business Service Surety Bonds are widely written by multiple surety bond markets. The respective minimum and maximum bond amounts for the Business Service Surety Bond are $10,000 and $100,000. The amount of bond needed is up to you but it is suggested that you purchase the maximum coverage available to protect your client’s property. DBL Surety can obtain some of the lowest rates in the industry and $10,000 of coverage can be purchased for the low amount of $100 annually. Each $10,000 increment of coverage costs just $100 which means $100,000 of coverage can be purchased for only $1,000 annually!!!

How do I apply for a Business Service Bond?

These surety bonds are instantly issued and all we need is a signed application which you can download here.