A surety bond is a contract that promises you will fulfill your obligations. Depending on what type of bond you need, your bond will promise different things. In Alabama, surety bonds are regulated by state insurance commissioners.
There are many industries in Alabama that might need an Alabama surety bond, from veterinary practices to mortgage brokers and notaries.
Short on time? Read our Surety Bond FAQ.
How to get a Surety Bond in Alabama
Step #1: Contact a Surety Bond Company & Apply for Bond
The first step to get an Alabama surety bond is to contact a surety bond company. You could also get a surety bond from your local insurance agency, but surety companies often have better rates and options available.
Learn about what are the best surety companies.
Step #2: Be Evaluated
Once you’ve applied for your bond, a surety bond underwriter will evaluate your application.
One the things the surety underwriter will evaluate is your credit score. Why? Because your credit score is a great example of how you have repaid companies in the past.
If a claim would occur on your Alabama bond, the surety company wants to make sure they get repaid. They will evaluate your credit score and other aspects to determine the risk of bonding you.
Once they’ve determined the risk of bonding you, they will provide you with quotes for your bond.
How Much Does a Surety Bond Cost?
You do not need to pay the full bond amount to get bonded. You will pay anywhere from 1-15% of the total bond amount.
The chart below is an example of how much you might pay for your bond based on your credit:
Step #3: Pick the Best Alabama Surety Bond Quote
The price you pay for your bond will range between 1% and 15% of the total bond amount.
Companies that are considered to be at higher risk of business and financial failure will pay higher percentage rates of (between 5 and 15%), while companies with a strong business and financial history will generally pay rates between 1 and 4%.
Learn more about how to know you are getting the best surety bond rate.
Step #4: Pay for Alabama Surety Bond
The last step is to pay for your bond. You will also need to sign an indemnity agreement.
Once you have your bond, you can submit it to the governing authority that requires it.
You do not need to pay monthly for your bond. Once it is paid in full, you are bonded and you do not need to pay again until the bond needs to be renewed.
Do You Need an Alabama Surety Bond?
Getting an Alabama surety bond can be expensive, but it doesn’t have to be.
At Surety Solutions, our online Bond Cost Calculator lets you view quotes for your bond so you can compare prices before you buy.
The best way to see what you’ll pay for your Alabama surety bond is to get a free quote:
