New business owners often look into the possibility of getting bonded. The process of bonding is essentially securing protection in the event that circumstances take place that cause some type of loss to a client, such as theft on the part of one of your employees. To get bonded means to be protected in situations where you or those working for you fail to deliver on covenants made with a client, thus ensuring the client that they will receive some sort of recompense for any financial losses they sustain as a result of your failure.
The process to get bonded varies slightly from one nation to another, depending on what type of rules and regulations apply to the bonding process in that location. However, there are a few essentials that tend to apply whenever an individual or business wishes to become bonded.
Your first task is to approach a bonding company and learn what types of bonds are available. Depending on where your reside and the type of work you do, you may need to secure one or more bonds in order to provide the proper protection to yourself and your clients. Some examples of bonds commonly issued are Indemnity and Payment, Bid bonds, Performance bonds, and License bonds. An agent with the bonding company can help you determine which options would be in your best interests.
Along with deciding which bonds you need, the process to get bonded also involves qualifying for the status. In most cases, this will mean filling out a formal application as well as submitting to a background check. Some jurisdictions will not issue a bond to anyone who has a criminal background. In other instances, people who have been involved in activity that is considered somewhat minimal may still be able to get bonded. The bonding company agent can provide details about the qualifications that apply in your area.
Along with the criminal background check, most companies will also speak with former employers, business associates, and investigate the status of your finances as part of the qualification process. Until the investigation is fully completed, you will not be able to get bonded. Once the bonding company has determined you meet all the necessary qualifications, you will be offered a range of options as to the amount of coverage you may establish and the payment schedule for the premiums to maintain your status.
Keep in mind that many jurisdictions require that the status of bonded individuals and businesses be reviewed from time to time. If there is a change in your financial status or you are found guilty of some type of illegal activity, there is a good chance your bond status will be revoked, although any issues dating to the period when the bonding was in force will remain covered. Depending on the regulations that are in force for the locality, you may not be able to get bonded later, even if all the issues that led to the revocation are resolved.
