Many a time, when our friends or acquaintances seek assurance that what we are promising them will be done, we normally assuage their fears by saying, “My word is my bond?” However, whereas it may work with friends and relations, in businesses it does not – our word is just not enough. They require something more solid, something surer and this is where the need arises for a surety or guarantor to be the link between the two.
All the guarantor has to do is to issue a bond that whatever you are promising to do, you will do and you will do it as per the specifications of the contract and that if you fail to do it the surety or the guarantor will take over and ensure that the contract is completed and pay the first party, all monetary losses that he has incurred.
Here are two examples to further illustrate this point:
Suppose the school where you children study, collects the whole years fees in advance. You go to great lengths to arrange for the money, taking loans, borrowing from friends, digging into your savings and then suddenly you find that the treasurer of the school has disappeared with the cash, even before the school could commence.
As a licensed institution, the surety would respond and you would be compensated by them, whilst they in turn would target the absconding party to make good their loss.
In our second example, let us assume that the city where you live is floating tenders for the construction of a new bridge. Now all those who bid for the bridge have to be provincially or federally licensed businesses and regulations demand that they require bonds.
Before accepting the bids and giving the task to a particular contractor, the city’s municipality must ensure that the contractor has the requisite experience, know-how and most importantly the funds to bring the project to its desired conclusion.
However, if the contractor furnishes a bid bond, it is proof that he merits the job, as a credit-check must have been done on him, without which he would not have got the bid-bond. A bid-bond is the assurance that the municipality needs that they have chosen rightly. The bid bonds or the performance bond ensures that the job will be completed as per specifications and that if somehow the contractor falters than the surety will step in, lend its expertise, take over the project and see it to its culmination. At the same time it will seek damages from the contractor.
The question that arises now is that in the eventuality of the surety provider being as lax and slipshod as the defaulters in both the examples, than what happens – the municipality, the school and you the parents would be left in the lurch. Hence it is of the utmost importance that one chooses the surety firm wisely.
One such firm is Ai Surety Bonding, a leading Canadian Surety Bonding Insurance Brokerage, which caters to clients across the world. Testimonials from satisfied customers have revealed that they maintain the highest standards in everything that they do, with an unwavering commitment to honesty and integrity. Not only will they ascertain your requirements before recommending a bond, they will not forsake you after you have taken the bond. They will, through their proficient staff look after your requirements before, during and after you have purchased a bond, answering all your queries and even reminding you in advance of your bond renewal.