Convincing Reasons to Use Surety Bond Insurance in Your Business

Posted on: 22 June 2022

As the owner of a contracting business, you want to offer the services for which customers hire you while also protecting your workers. You likewise want to lower any financial liability your company bears during ongoing projects for your clients.

With that, you may need to invest in financial protection for your business and the people who work for you. You may find it helpful to purchase surety bond insurance for the employees you hire to work for you.

Avoiding Expensive Claims

When you have surety bond insurance taken out on your employees, you may avoid expensive claims against your company. When something goes wrong during a project, the client who hired your company may have the legal right to take action against the contractor who worked on their home or business, as well as you and your company.

You do not want to pay for any court judgment or settlement out of your own pocket. Doing so could put you out of business and take away from the money you use to support your own family.

Instead of paying out claims yourself, you can keep surety bond insurance on your employees. The surety bond insurance may be responsible for paying out claims any client files against your worker or business.

Paying for Damages

The surety bond insurance can also pay for damages your clients incur during the course of a project for which your employees and business were hired. For example, if one of your workers causes a fire while remodeling a client's kitchen, this worker's surety bond insurance can pay for the repairs and cleanup in the client's home. 

The surety bond insurance ensures your client gets compensation for damages he or she did not cause. It spares this person from having to pay out hundreds or thousands of dollars for damages your employee inflicted on the person's home.

Appealing to Customers

Finally, surety bond insurance can make your company more appealing to potential customers. They may prefer to hire your company if they know they will have the protection of surety bond insurance you take out on your employees. They know they will receive compensation if any mishaps occur during projects.

Surety bond insurance serves an important purpose in your contracting business. It lowers your company's financial liability. It also pays for damages your workers may cause in a person's home or business and can make your business more appealing to customers.


Little-known Insurance Tips

While I have had auto insurance ever since I bought my first car at 16 years old and home insurance ever since I bought my first home several years ago, I have to admit that over the years I knew very little about insurance. I tended to just look at the price of the coverage and sign the paperwork without really looking into the pros and cons of each policy. After my friend was in a car accident recently (thankfully, she is okay!) and she said she had to pay for some of the damage to the other vehicle out-of-pocket even though she had a minimum state coverage auto insurance policy, I decided to put a lot of careful research into insurance policies and what they really offer. I want to help others by sharing the information I have learned on a blog. I hope I can help you!