Texas 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 Texas surety bond needs.

Required Surety Bonds in Texas

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

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Required Surety Bonds in Texas

There are three broad categories of Texas surety bonds: construction and contractor bonds, license and permit bonds, and court bonds.

Texas Construction & Contractor Bonds

At the municipal level, construction contractors may be required to obtain bid bonds, performance bonds, payment bonds, and/or maintenance bonds in order to bid or work on publicly funded projects.
Contractor bonds required at the state level include bonds for commercial services contracts, maintenance agreements, commercial supply contracts, management contracts, and so on.

Texas License & Permit Bonds

License bonds are often required as a prerequisite for obtaining a license to operate in a certain professional capacity within the state. In Texas, a wide range of businesses need to be licensed and bonded at the state level—such as motor vehicle dealers, health clubs or gyms, third party debt collectors, money transmitters, driving schools, and more.
Certain municipalities also require surety bonds for professionals operating within their jurisdictions, most notably contractors offering commercial or residential construction or remodeling services.

Texas Court Bonds

Court bonds are often required by Texas courts for a variety of purposes. Among the most common court bonds are appeal bonds, probate bonds, and guardianship bonds.

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Whatever type of Texas surety bond you need, our experienced surety agents can help you. Apply now!

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.