Surety bonds are like a reference letter from a reliable source that lets your customers, suppliers, or partners know you have the capacity to complete a project or deliver goods as specified in a contract. The surety issuer takes on the liability of any default or failure on your part. If you fail to live up to the terms of the contract, the surety provides financial compensation to your partner.
Surety Bonds
What are Surety Bonds?
Download our infographic to learn what a surety bond is, how they work, and the types of surety bonds that we offer.
How do Surety Bonds Work?
Surety bonds are a three-party agreement between you (the purchaser of the bond), the surety company that promises to be liable for the contract if you default, and your customer or project owner who requires the bond. You are considered the principal in this contract. If you do not live up to the terms of the contract, the project owner (known as the obligee) turns to the surety to collect damages. In the event of a payout, you are responsible for paying the funds back to the surety.
When competing for business, you need a reliable surety partner who understands your plan and your industry. Allianz Trade's team of domestic and international surety experts provides a high level of knowledge and service, so you can compete quickly and confidently.
Why Allianz Trade For Surety Bonds?
A Solid Guarantee
With established surety teams around the world, Allianz Trade is uniquely capable of providing true integrated international surety bond programs, giving you central management and one point of contact for operations in multiple countries.
Team of Specialists
Our investment grade rating (AA S&P, A+ AM Best) is accepted by corporations and banks across the globe. We are also part of the Allianz family, the global leader in financial services, making Allianz Trade a reliable partner for surety bonds.
True International Partnership
Our worldwide presence and information on global markets allows us to accurately calculate the risks you face to provide you the coverage you need so you don't miss out on international opportunities.
Proprietary Information
Our experienced and knowledgeable construction and surety bond specialists provide you with responsive service and solutions, making it easy to do business.
Personalized Service
We evaluate each account on an individual basis and tailor surety bonds solutions to your unique needs. Our personalized approach enables us to find optimal solutions for your business.
Experience
After nearly a century working in the surety bonds business, we are one of the most experienced global surety providers and bring this unmatched expertise to the US market.
Types of Surety Bonds Allianz Trade offers
Contract surety bonds are a common requirement in the construction industry. We offer bid, payment, performance, supply and maintenance bonds for mid to large contractors, including:
- General Contractors
- Construction Managers
- Prime Electrical
- Prime Mechanical
- Highway and Bridge
- Sewer and Water
- Specialty Trades
Commercial Surety Bonds
Commercial Surety bonds may be required by local and state law to comply with state or federal regulations. We offer a variety of bonds to for mid to large companies:
- Performance Bonds (Non-Construction or Supply)
- Court Bonds — Judicial
- Court Bonds — Fiduciary
- Custom Bonds
- License and Permit Bonds
- Tax Bonds (Motor Fuel, Alcohol, Tobacco)
- Workers’ Compensation Self-Insured Bonds
Frequently Asked Questions About Surety Bonds
No. While insurance transfers risk, a surety bond is a guarantee of performance. The principal remains financially responsible for any valid claims paid by the surety.
Surety bonds are commonly required for contractors, construction firms, service providers, and businesses working on public or regulated projects.
The main types of surety bonds include contract bonds (bid, performance, and payment bonds) and commercial bonds required by government agencies or regulators.
They help businesses qualify for larger projects, build credibility, and manage contractual risk more effectively.
Surety bonds complement trade credit insurance and other risk management tools by protecting contractual and financial obligations.