Protect your commercial interests with a surety bond
A surety bond can help protect the interests of your growing business.
Desjardins Insurance combines the financial strength of our full service commercial surety bond department with local agents to provide you with superior service.
When your business is required to guarantee its performance to another, we have surety bond solutions to back up your guarantee.
Why do I need a surety bond for my business?
- As a business owner, you may need a surety bond to guarantee payment for sales taxes or utility bills.
- As a contractor, you may need to post a licence or permit bond to guarantee your work for licencing requirements with municipalities.
- Lawyers may have clients that are required to post court bonds, such as administrator or executor bonds, to guarantee their performance while distributing assets in estates.
Types of surety bonds
Licence and permit bonds back up guarantees that, in doing its work, your business will comply with applicable codes and regulations established by a government entity, such as a city, town or province (the "obligee").
- Electrician's licence
- Plumber's licence
- General contractor's licence
- Driveway permit
- Sign permit
- Sales tax
Example: electrical contractors may be required to post a bond as part of their licencing requirements. The obligation of the bond may specify that the contractor will follow the electrical codes established in that city, town or municipality.
The requirements of the bond and ordinance must be understood before the bond is written. The agent may ask you to obtain a copy of the ordinance or law that specifies the requirements and a copy of the bond, if the obligee has its own.
Depending upon the type of obligation, supporting documentation such as signatures, financial statements and other supplemental information may be required.
Probate bonds back up guarantees of an honest accounting and faithful performance of duties by fiduciaries/trustees. These bonds are required by courts or statutes while estates of deceased persons, incompetent persons or minors are set up and administered.
Bankruptcy or equity bonds might be required of an appointed fiduciary for the sale of real estate or for property in foreclosure, reorganization or other litigation. These bonds guarantee an honest accounting and performance of duties while managing and distributing the assets as directed by the court.
Common types include receiver and trustee bonds.
Other judicial bonds may be required by a court in cases where someone is seeking a legal benefit or relief. Specific supplemental information may be required.
- Attachment bonds
- Release of lien
Miscellaneous surety bonds include those that do not fit into any of the other surety categories. These are usually more hazardous obligations.
- Utility payment guarantees
- Lost security/lost instruments (cashier's cheque, stock certificates and municipal bonds)
- Union wage and welfare
Miscellaneous surety bonds require more extensive underwriting because the guarantee to the obligee is monetary. In addition to the application, supporting information such as signatures, financial statements and other supplemental forms are usually required.
This is only a general description of coverages of the available types of business insurance and is not a statement of contract. Details of coverage, limits, or services may not be available for all business and vary in some provinces. All coverages are subject to the terms, provisions, exclusions, and conditions in the policy itself and in any endorsements.
Note that your insurance needs may change through the lifecycle of your business.