Sometimes surety underwriters require collateral be posted with the surety company - in addition to premium payment - before a bond can be issued. The collateral provides security to the surety company for high-risk bond types and/or client accounts. In the event of a claim, the surety company can use the collateral to recoup their losses.
The decision to approve an application conditionally after collateral has been formally filed is at the sole discretion of surety underwriters. If a SuretyBonds.com client is conditionally approved pending collateralization, our team will provide a collateral packet. Each surety company has its own collateral agreement that outlines specific terms and conditions for their collateral requirements and processing.
Surety bond types that might require collateralization before bond issuance include, but are not limited to:
- appeal bonds
- lottery bonds
- performance bonds
- utility bonds
Surety companies typically do not release collateral back to clients until after the associated surety bond obligation has been fulfilled and/or formally canceled.
Note: If you previously filed collateral for a surety bond or account, SuretyBonds.com cannot release or return your collateral to you. Collateral can only be released/returned by the surety company with which the collateral was directly filed.
If you have further questions about surety bond collateralization, call 1 (800) 308-4358 or email firstname.lastname@example.org, and one of our friendly representatives will be happy to help.