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Bond Type Guide

Fidelity Bonds

Fidelity bonds protect businesses against employee dishonesty, theft, and fraud.

Typical Cost: $100 - $500/year per employee

What is a Fidelity Bond?

A fidelity bond protects a business against losses caused by fraudulent or dishonest acts of its employees. While technically a form of insurance rather than a surety bond, fidelity bonds are commonly sold by surety agencies.

Types of Fidelity Bonds

  • Business Service Bonds — For companies whose employees work at customer locations (janitorial, home health, etc.)
  • Employee Dishonesty Bonds — Covers losses from employee theft or fraud
  • ERISA Bonds — Required for fiduciaries of employee benefit plans

    • Who Needs a Fidelity Bond?

  • Businesses with employees who handle cash or valuables
  • Companies whose employees work in clients' homes or offices
  • ERISA plan fiduciaries (required by law)
  • Government contractors

    • Other Bond Types

    Bid Bonds

    A bid bond guarantees that a contractor will honor their bid and enter into a contract if awarded the project.

    Performance Bonds

    A performance bond guarantees that a contractor will complete a project according to the terms of the contract.

    Payment Bonds

    A payment bond guarantees that a contractor will pay subcontractors, laborers, and material suppliers.

    License & Permit Bonds

    License and permit bonds are required by government agencies to obtain or maintain a business license.

    Court Bonds

    Court bonds are required by courts during legal proceedings, including appeal bonds, guardianship bonds, and fiduciary bonds.

    Commercial Bonds

    Commercial surety bonds encompass a wide range of bonds required for business operations beyond construction.