You like to have a feeling of certainty about your decisions. How do you know if it’s worthwhile to get a surety bond? Surety bonds are all about that certainty — a way to build trust between your company and your clients.
What is a Surety Bond?
A surety bond is a relationship between a company, a client, and a surety bond provider. If things go awry and the company cannot fulfill its obligations to the client, then the surety bond company will step in to help the client.
Surety bonds are different from insurance. Insurance protects the person who holds the policty. A surety bond does not protect the person who holds the surety bond. Rather, a surety bond protects the clients of the one who has the surety bond. You can learn more about the differences between surety and insurance.
Not sure if you need a surety bond? Check out this post: 4 Reasons You Might Need a Surety Bond.
4 Ways a Surety Bond Delivers Peace of Mind To Your Customers
#1: A Surety Bond Shows You’ve Done Your Due Diligence
Why get a surety bond? Most importantly, a surety bond helps you do your due diligence as a company. If you’re taking on a large project, you need to make sure that your organization is in good financial shape and able to sustain the contract to the end.
During the bonding process, a surety bond company will work with you to look at your organizational structure, history, and financial capacity. When you get a surety bond, this tells your clients that you’ve done your due diligence and that you’re able to take on the project.
#2: A Surety Bond Means You Have Someone Who Can Vouch For You
References are important, and while the surety bonding process can involve references from past clients or customers, the bond itself is a type of reference.
A surety bond tells your customers that an external organization has examined your structure and your finances and has deemed that you are able to fulfill the legal obligations of your industry or successfully manage a project. Having someone who can vouch for your abilities can give your company peace of mind.
#3: With a Surety Bond, Your Clients Know That They Can Trust You
#4: With a Surety Bond, Your Clients Have a Fallback Plan
- What if you fail to follow through on your obligations?
- What if the project fails?
- What if you go out of business?
Surety bonds provide an answer to these “what if” questions. The bond company is there to protect your clients in case your company fails to do the same. It delivers peace of mind to your clients, so that even if they have uncertainty due to the size of a project, they know that they have a fallback plan.
Learn about how your clients are protected with the surety bond claim process.