Corporate suretyship was first undertaken many years ago. Once organizations began to specialize in issuing surety bonds, formal contracts backed by corporate assets became available to meet a wide variety of business and individual needs. Surety bonds are now required by business interests, courts, government entities, and public agencies as a means of reducing or transferring the risk of business transactions and legal proceedings. A typical surety bond identifies all three parties to the contract and spells out their relationship and obligations. Under a bond, strictly speaking, both the principal and the surety are obligers.
Most people are familiar with bail bonds.
Someone arrested on a criminal charge may be held for trial, unless they furnish the required bail which can be in the form of a bail bond. When a bail bond is issued, the principal, the person released, agrees to appear in court at the designated time and place. Only a person holding a bail license may solicit, negotiate, and effect an undertaking of bail or bail bonds for an insurer. Yes, all bail bond agents are licensed by the Department of Insurance and are required to post a bond as prescribed by the insurance code. A. Not necessarily, but all bail bond agents are appointed by licensed insurance carriers or surety companies and must comply with the provisions of the California Insurance Code and Department of Insurance Regulations.