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Glite Dictionary
surety bond

surety bond

1 7.7
A promise by another company to pay the client if a contract is not fulfilled
  • noun
  • /ˈʃʊrɪti bɑnd/
  • Formal
translation icon : fianza
  • The types of financial guarantees regulators can require of credit producers include surety bonds, trust funds, escrow accounts, sinking funds, insurance, self-bonds, and corporate guarantees. Id. at 105.

Examples

  • The contractor had to provide a surety bond to guarantee the project would be completed on time.

  • It was a surety bond in the amount of 700,000 Imperials.

    Fiction book (1991)

  • It was my job to register the company with all of the state insurance departments that the company did business in. Part of said registration required getting a surety bond worth $100,000.

    Blog text (19)

  • Typically, defendants rely on friends or family members to either post cash bail at a predetermined facility or visit a bail bonding company, which then posts a surety bond.

    Academic text (2017)

  • Hopkins was placed on a $75,000 cash/surety bond for the Chesterfield Township crime and is being held in Macomb County Jail.

    Blog text (6)

  • Before starting the construction project, they submitted a surety bond to assure the client against any potential losses.

  • In order to secure the loan, the borrower needed to present a surety bond from a reputable insurance company.

Synonyms

guarantee
vssurety bond
  • Formal
169 3.5

A promise by someone to pay a debt if another person fails

is a specific third party instrument that pays recipients for contract breaches
guaranty
vssurety bond
  • Formal
4 8.2

A written promise to pay someone else's debt if they cannot

is a formal third party promise that pays losses when contract terms are unmet
surety
vssurety bond
  • Formal
1 8.9

Property or money given to the lender so the loan will be repaid

is a third party promise to pay recipients for losses when contract terms fail
performance bond
vssurety bond
  • Specialized
1 7.2

A promise by an insurance company to pay a client if a contractor does not finish the work

is the same guarantee phrased generally as a third party promise to pay losses

Surface Forms

surety bond singular
surety bonds plural

Morphology

surety + bond

The phrase is compositionally built from 'surety' (a guarantor) + 'bond' (a guarantee/obligation instrument), so a learner who knows both constituent meanings can infer it denotes a guarantee provided by a third party. Although 'bond' can also mean a debt instrument in some contexts, the modifier 'surety' makes the guaranteeing function explicit, making the overall meaning readily derivable.

Etymology

Surety bond comes from the idea of a surety, a person who promises to be responsible, and a bond, a written promise. Imagine someone standing behind a contractor saying 'I'll pay if they don't'. That's why a surety bond means a promise by another person or company to 'pay' for losses if the contract is not kept.