Delaware Surety Bonds

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Surety Bond Professionals is a family-owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all of your Delaware surety bond needs.

Required Surety Bonds in Delaware

Typical Delaware bonds include (click on any for more info):

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Required Surety Bonds in Delaware

Delaware surety bonds, like those issued in all other states, fall into one of three broad categories: construction and contractor bonds, license and permit bonds, or court bonds.

Delaware Construction & Contractor Bonds

The state of Delaware and some municipalities require contractors to purchase certain types of surety bonds in order to bid on or be awarded public works projects over a certain value. Bid bonds, performance bonds, and payment bonds are the ones most commonly required.

Delaware License & Permit Bonds

Delaware requires statewide licensing of certain types of businesses, and purchasing a surety bond is often one step in the licensing process. Licensing and/or permitting is also required at the local level in some municipalities, which also may involve purchasing a surety bond. A license and permit surety bond guarantees that the bonded business will operate in in a completely lawful and ethical manner.

Delaware Court Bonds

Courts at any level in the Delaware judicial system can require surety bonds from people involved in certain legal proceedings. For example, plaintiffs and defendants appealing a court decision, particularly in cases involving contested property or large damage awards. Court bonds also may be required from people named to serve in a fiduciary capacity and manage funds belonging to another, such as the executor of an estate or guardian of a minor.

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Frequently Asked Questions

There are three parties to every surety bond agreement, which is a legally binding contract:

  • The “obligee” is the state or local agency requiring the surety bond.
  • The “principal” is the party required to purchase the bond.
  • The “surety” is the company underwriting and issuing the bond.
  • The obligee sets the required amount of the bond, which is the maximum amount that will be paid out on a claim. The obligee also spells out the conduct required of the principal in order to avoid claims against the surety bond.

Any party who suffers a financial loss because the principal has violated the terms of the bond has the right to file a claim against the bond. The principal is solely responsible for paying all valid claims.

However, the surety will often pay a claim and wait to be reimbursed by the principal. This ensures timely settlement of the claim and gives the principal some time to gather the necessary funds.

What the principal in a bond agreement actually pays for a surety bond is a small percentage of the required bond amount established by the obligee. That percentage, known as the premium rate, is determined by the surety company based on the applicant’s credit score and other indicators of the likelihood of claims being filed against the bond. Those with good credit can expect a rate of 1-3%. Those with poorer credit may pay a higher premium.
No claim against a bond will be paid until the surety company has investigated and determined that it is valid. After making payment to a claimant, the surety company will demand reimbursement from the principal.