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So far PatBondUSA has created 14 entries.

Security and Fidelity Bonds are Interrelated but not Identical

Against the best efforts of the business community and in spite of background checks, fraud and contractual violations are rife, but, thankfully, security bonds and fidelity bonds comprise great ways to ward against them. Understanding the difference between a security bond and a fidelity bond might sound like choosing whether to bake apple pie or apple pie, though. Safety, security, surety, fidelity…don’t these words mean the same thing? Not exactly. When it comes to insurance, security bonds and fidelity bonds are interrelated, but not identical.

A security bond, also known as a surety bond, is a way of making sure that one party, called the obligee, who has formed a contractual relationship with another member, the principal, will be compensated in case the principal doesn’t hold up their end of the deal. Surety bonds are often used when property owners hire contractors and are common in court cases. In the […]

Difference Between Security and Fidelity Bonds

Against the best efforts of the business community and in spite of background checks, fraud and contractual violations are rife, but, thankfully, security bonds and fidelity bonds comprise great ways to ward against them. Understanding the difference between a security bond and a fidelity bond might sound like choosing whether to bake apple pie or apple pie, though. Safety, security, surety, fidelity…don’t these words mean the same thing? Not exactly. When it comes to insurance, security bonds and fidelity bonds are interrelated, but not identical.

A security bond, also known as a surety bond, is a way of making sure that one party, called the obligee, who has formed a contractual relationship with another member, the principal, will be compensated in case the principal doesn’t hold up their end of the deal. Surety bonds are often used when property owners hire contractors and are common in court cases. In the […]

Many Start-Ups Overlook the Need for Surety Bonds

If you are starting your own business, one of the last things you may think about is obtaining a surety bond. When it comes to start-ups, however, surety bonds are an important consideration.

Many business owners mistakenly believe that if they have insurance, they don’t need a surety bond. But surety bonds and insurance serve two very different purposes. Insurance is a promise of compensation for specific losses in exchange for periodic payments. It is designed to protect financial well-being in the event of unexpected loss.

Surety bonds, on the other hand, are similar to credit and provide financial and legal protection for businesses. They also provide a guarantee that a contract will be honored by an individual or company and provide financial protection in the event that it isn’t honored.

Surety bonds are an agreement between three parties:

The surety company or other agency that issues the surety bond.
The principal, which is […]

Insurance vs. Surety Bonds

Do you know the difference between being bonded and being insured? If you answered no to this question you are not alone. The answer is that insurance protects against loss while a surety bond protects against breach of contract.

Of course, it is a little more complicated than that so let’s break down the differences:

Difference No. 1: Insurance is a two-party contract between the insured and the insurance company. The insurance policy, or company, promises that the insured with be compensated if there is a covered loss. A surety bond is a contract between at least three parties. The surety is issued by one party on behalf of the principal, or second party. The contract guarantees that the second party will honor an obligation to the third party, called an obligee. If the obligation is not met, the obligee can recovers losses under the surety bond.

Difference No. 2: With insurance, […]

The “Three Cs” of Surety Bonds

If you are a contractor, chances are you have heard of the “Three Cs” of contract surety bonds. If not, here is a brief tutorial that will help to explain it.

The “Three Cs” refer to how an underwriter views an individual contractor’s Character, Capacity, and Capital. These “Three Cs” help a bond underwriter evaluate how a contractor should be rated.

Character: Does the contractor’s record indicate that they have been responsible and have a proven track record of fulfilling their obligations and meeting the terms of their contracts? Unfortunately, contractor default can be a common occurrence. When such a default happens, a project owner must declare, formally, a breach of contract. The surety bond provider then conducts an investigation before any claim is settled. This impartial investigation protects the contractor in cases when a project owner declares that the contractor is in default but that is not the case. After […]

Safety Pitfalls of Filling Potholes

Many people wonder why so many workers are needed for pothole repair. Although only two or three workers are required to actually repair a pothole, keeping those workers safe is another job in itself. In fact, to keep workers safe while they are filling a pothole, a crew of up to 10 workers may be necessary depending on where the pothole is being filled.

The large number of workers involved in patching potholes is designed to keep crew members protected from fast-moving traffic and provide as many barriers as possible between workers and the large number of vehicles passing by.

Potholes on an expressway require the most workers because of the volume of traffic. Even more workers may be necessary if the pothole is on or near an exit ramp.

Here is an example of a typical pothole-filling crew:

One blocker truck driver. Usually a crew chief, he or she drives the truck […]

The Importance of Construction Surety Bonds

What Are Construction Surety Bonds?
Construction surety bonds, or contractor’s license bonds, are used to ensure that construction projects are covered in the event that the contractor hired to do the job does not complete it. The “obligee,” or project owner, contracts with the “principal,” or contractor, to complete a specific project. The contractor then secures a surety bond from a surety company or broker who sells contractor’s license bonds. Patriot Bonding LLC is one such broker.

In the event that the contractor fails to complete the project, the surety company must either compensate the project owner for their losses or find another contractor to complete the project according to the contract specifications.

Contractors wishing to bid on Federal, state or local projects are required to be bonded to do so. Increasingly, private companies are requiring contractors to have bonds as well. Additionally, some areas require bonds to be in place before issuing a […]

The Benefits of Medicare Surety Bonds

In today’s medical marketplace, it is crucial to obtain Medicare surety bonds with a qualified company. Such bonds provide protection, reduce fraud, and ensure that customers receive care from legitimate medical equipment suppliers.
Definition of Medicare Fraud
Medicare fraud is when illegal practices are conducted with the intention of receiving payouts from government healthcare programs. Some types of Medicare fraud include:

Billing for services that were not provided
Performing unnecessary tests
Giving unnecessary referrals
Charging separately for services usually charged together

How to Avoid Medicare Fraud
One of the easiest ways to hinder Medicare fraud is to secure in a surety bond. This erects a “checks-and-balances” system that establishes security between customers, Medicare, and the company issuing the bond.
Surety Bonds: A Closer Look
A surety bond is a promise to pay the obligee (the beneficiary) if the principal (the one who obtains the bond) does not fulfill an obligation. Surety bonds protect the obligee from losses if the […]

Surety Bonds for Restaurant Liquor Licenses

In many parts of the country, restaurant owners cannot obtain liquor licenses until they secure a surety bond. For example, in New York, owners are required to obtain a bond for $1,000 before applying for a license. The total bond amount required for each location varies according to local liquor regulations. Luckily, restaurant owners can easily apply for a protective tax bond by providing a fully completed application using their business information. If you have questions about obtaining a liquor license, here is a general outline of the process: You also may call Patriot Bonding LLC in Scottsdale AZ toll free (888) 820-7420.

Step 1: Gather Information

Restaurant owners can sign up for a bond using an online or paper form. Either way, it’s important to make sure all of the restaurant information is on hand before starting the application process. Business owners need to figure out if the restaurant falls […]

A Current Look at the Freight Industry – Freight Broker Bond

If you are currently in the freight or transportation industry, than you are probably familiar with the financial changes due to bill MAP-12. Every freight and large transportation company is required to purchase a freight broker bond. This bond is required in order to demonstrate a company’s financial responsibility, as well as the assurance that a business will strive to comply with contracts, agreements, and government guidelines. With the signing of the MAP-21 bill (Moving Ahead for Progress in the 21st Century Act) in July of 2012, the freight broker bond jumped from a minimum $10,000 bond to a $75,000 bond. The reactions to the change was mixed to say the least, the majority of fears being that many small businesses couldn’t handle the large jump in costs. Now, two years later, where are we in the freight industry? Have the changes in policy produced positive results or any […]