If you own a small business in New York, you would eventually encounter a surety bond in the course of doing business. If you are searching for New York surety bonds to conduct your business legally, you may wonder what the financial benefits to the bonding process. Also, you may want to know the financial and legal ramifications of not purchasing a surety bond when one is required. If you are curious about the bonding process, you should keep on reading this article to learn about New York surety bonds.
A surety bond is an agreement between three parties such as the party that needs the bond, the party that purchases the bond, and the bonding company. Most of the time, the party that needs a surety bond is a government organization. In fact, the government plans to protect the taxpayer’s money in the process. If the business that undertakes a government project cannot complete it in a timely manner, the government organization has the right to file for damages. The surety bond will settle the amounts claimed by the government agency. In fact, if the terms and conditions of the bond agreement are met, the surety company is bound to honor the claim and pay damages to the government. A surety bond is not a form of insurance but a form of credit.
Becoming bonded is inexpensive and simple. The bond amount will vary depending on the type of bond you purchase. In fact, surety bond rates will depend on the financial health of the applicant company. There are many incentives for a small business to maintaining a valid surety bond. The business can mention their bond status in their advertisements which will improve your sales over time. On the other hand, consumers prefer to conduct business with a safe and reputed company in this day and age. That is why a small business should have a valid license, insurance coverage, and bond to enhance their reputation in the industry.
If a small business that requires a surety bond, doesn’t fulfill this legal requirement, there are many legal and financial consequences to it. There could be fines and legal action taken against such businesses by the state, local or federal government. Not having a surety bond can result in the revocation of the business license of your company. A consumer will view the functions of a bonded company more positively compared to a business that is not bonded. It is a sign of your company’s willingness to perform the job ethically. That is why you need to apply for a surety bond in New York.
With a host of bonding companies operating in New York, choosing the right bonding company is not easy. You have to conduct extensive research when picking the right company for this purpose. Bonds Express is one of the best bonding companies in New York. It has been in business since 1967. They are dedicated to providing surety bonds at the lowest cost possible. That is why you need to choose Bond Express for all your surety bonds in New York.