Surety bonds provide a wide range of support for business owners. While they may seem like just another expense to some small business owners, they actually provide a number of key benefits like providing customers with a sense of confidence in the bonded company. If you are on the verge of starting a business or you want to put a better level of security in place, consider a few key reasons you need these bonds in place.
#1: Surety Bonds Ensure Your Customers are Safe
Surety bonds give your customers and clients the support they need to know they have a backup in case an error leads to a loss. Customers often expect companies to carry bonding. If you do not have it, chances are good your competitor does.
#2: It Reduces Your Financial Risk
If a project goes bad, a mistake is made or something else happens and the finished work is not what was promised, your surety bond can help to minimize the out of pocket expenses you have to pay to the customer.
#3: Guaranteeing Payment
One of the lesser known benefits to surety bonds has to do with your customer's payment. If and when a payment does not happen, a surety bond may guarantee that payment to you. Your policy needs to be specifically written for this benefit in order for it to be present.
#4: A Bond May Be Required
Some professionals who must obtain a license to operate in the state or local jurisdiction may be required to obtain a surety bond. In fact, having surety bonds may allow you to work in areas where your competition without a bond cannot.
#5: Bonds are Inexpensive
In most cases, surety bonds are not nearly as expensive as the other types of insurance you may have. And, they tend to offer far more benefits than drawbacks.
Surety bonds should not be something you overlook. Take the time to consider what they are, how they can fit your needs and exactly how affordable they can be. It may be just what you need to gain the confidence from your customers or clients to land the way.
Do you have the coverage you need? Call Insurance Planning Service at (800) 220-5582 for more information on Michigan surety bonds.