The Surety Bond Renewal Process
The language of surety bonds requires bonding companies to collect renewal premium payments well before bond expiration. For instance, each surety bond will have a “cancellation clause” that specifically states how much advance notice bonding companies are required to give principal and obligee prior to the bond’s expiration date. Most cancellation clauses require notification to be delivered in writing either 30, 60 or 90s prior to expiration. Hence, cancellation clauses must be considered when determining when payment for renewals will be due to the bonding companies, which as I previously stated can be a few months out (prior to bond expiration).
Latest posts by Victor J. Lance, President/Owner (see all)
- How to Get Your Contractor License in New Castle County, Delaware - July 18, 2019
- New Mexico Changes License and Bond Rules for Insurance Adjusters - July 15, 2019
- How to Register Your California Credit Services Organization - June 28, 2019