Surety Insurance Key Terms

Learn the ins and outs of the surety insurance industry with these key concepts

There are various degrees to which surety insurance may be used to protect businesses. In the most popular and common form of surety insurance, the insurance works to prove that businesses are able to meet their obligations. Such policies can be written for almost any purpose or obligation, including those based in finances. As such, it is important for businesses to choose the most appropriate form of surety insurance and in order to do so, you need to understand surety insurance key terms and concepts that pop up in the industry and within surety insurance policies.

 

Conservator

A conservator is the person, individual or entity who is utilized to act as the protector of the interest of an incompetent potential policy holder or a minor. They are designated to the position.
Try: The importance of a conservator to purchase a surety insurance bond is explored at Tripod.com.

Funds control

Funds control is a method through which the cash flow of a project is controlled. In many cases, funds control is implemented in order to ensure that subcontractors and suppliers will be paid appropriately. Most often, funds control is used when a contractor is otherwise unable to qualify for a bond.
Try: Funds control as it may be required for surety insurance is explored at RKABonds.com, as well as other surety insurance frequently asked questions.

Treasury listing

Treasury listing is an official financial rating. It is published by the federal government. The treasury listing illustrates the maximum size of a federal bond that a surety is permitted or authorized to write. Treasury listing may also be referred to as the t-list.
Try: An explanation of the treasury listing and how to obtain a copy is disclosed at Sio.org.

Small Business Administration

SBA stands for Small Business Administration. The Small Business Administration offers a program designed to assist small businesses and minority-owned contracting companies in the acquiring of their surety bonds.
Try: An in-depth analysis of the SBA raising the surety insurance bond ceiling is presented at BizJournals.com.

Errors and omissions insurance

The errors and omissions insurance policy is put in place in order to provide coverage for businesses in the event of unintentional errors, omissions or other mistakes. It is commonly referred to as E&O.
Try: Additional information on errors and omissions insurance as a part of surety insurance is discussed at CNASurety.com.

Fiduciary

A fiduciary is an appointed individual who is hired to act in the best interest of another individual. They handle the affairs of those who are unable to handle their own affairs. In many instances, fiduciaries are requested in order to furnish a bond which would be implemented to protect against failing performances of their duties.
Try: Fiduciaries and fiduciary bonds are discussed in detail at JWSuretyBonds.com and BozzutoInsurance.com.

Copyright © 2011 Business.com, Inc. All Rights Reserved.

---