What is a Surety?

Surety is a promise by a third party (Mid Century Insurance Company) to pay--or sometimes perform--on behalf of the primary party (the Principal), should this latter party fail to complete obligations agreed to in the bond. The Beneficiary (or Obligee) receives the benefits promised in the bond.

Surety bonds are divided into two categories: commercial surety and contract (construction) surety.

Commercial surety bonds
are subdivided into 3 general categories:

Court and Fiduciary Bonds

Guarantee principals will successfully prosecute litigation - appeal, attachment, etc., - or reimburse adverse    parties for resulting damages.  Examples include:

  • Administrator / Executor Bond

  • Guardian / Conservator Bond

  • Receivers Bond

  • Plaintiff Bonds

  • Attachment / Garnishment Bond

  • Replevin Bond

  • Injunction Bond

  • Indemnity to Sheriff Bond

  • Appeal, Supersedes, Stay of Execution Bond

License, Permit and Miscellaneous Bonds

Guarantee compliance on the part of individuals and firms with the laws, regulations or private agreements to which principals become obligated.  The vast Majority of Surety Bonds executed in this program will arise under this category of surety bond.  Examples include:

  • Agriculture
  • Brokers / Agents / Adjusters

  • Customs

  • Excise, Sale, Use & Consumer Tax

  • Highway, Street & Subdivision

  • Lost Instrument

  • Motor Vehicle

  • Professional Licensees

  • Regulatory / Compliance

  • Warehouse

  • And many more...

Public Official Bonds/Public Employee Blanket Bonds

Guarantee the honesty and faithful performance of an official's duties, as prescribed by law, regulation or ordinance, including the honest account of all monies entrusted to the official according to the law.  Examples include:

  • Treasurers (State, County, City, etc.)
  • Tax Collectors (State, County, City, etc.)
  • Sheriffs and Deputies
  • Court Clerks
  • Special Bond Issues
  • Hunting, Fishing Licenses, Auto Tags, etc. - Agents for Sales of . . .
  • Notaries Public
  •  School Treasurers Bonds
  • And many more...

Contract (construction) surety

These bonds guarantee both financial and performance aspects of a job being done under contract. The major subcategories of these bonds provide assurance that performance, supply delivery, maintenance, and the like all occur as prescribed in the contract agreement. You commonly see references to "bonded and licensed" when looking for plumbers, electricians, contractors for construction, and such. General Contractors who are bidding to receive large jobs usually need the largest bonds. A contract bond is required to be taken out as the assurance they will complete the job or the bonding company will step in to do so in their place. No limit is placed on the size of the bond request. This is determined after careful analysis of the applicant’s financial capacity by the F&D underwriter. Examples include:

  • Bid Bonds
  • Performance Bonds
  • Labor and Material Payment Bonds
  • Subcontract Performance Bonds
  • Subdivision Bonds
  • Maintenance Bonds
  • Supply Bonds

For more information please call us at 408-241-7641 or email us.

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