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Comprehensive Guide to Indiana Surety Bonds: Your Path to Licensing and Compliance
Surety bonds are a critical component for many businesses and licensed professionals operating in the state of Indiana. They serve as a financial
guarantee that you will comply with state and local laws, follow professional regulations, and meet contractual obligations.
This comprehensive guide will break down what an Indiana surety bond is, why you need one, the different types available, and a simple step-by-step process for securing yours.
What is an Indiana Surety Bond?
An Indiana surety bond is a legally binding agreement involving three parties:
- The Principal: You, the business, or the individual required to obtain the bond (e.g., a contractor, auto dealer, or notary public).
- The Obligee: The government entity (state agency, city, or county) that requires the bond. They are the party protected by the bond.
- The Surety: The insurance company that issues and financially backs the bond. They guarantee the Principal’s obligations to the Obligee. Surety1.com represents over a dozen, “A” rated surety bond companies.
The Key Purpose: The bond acts as a protection mechanism for the public or the Obligee. If the Principal fails to meet their legal or contractual duties and causes financial harm, the Obligee or a damaged party can file a claim against the bond. The Surety will pay out the claim up to the full bond amount, and then the Principal is legally obligated to repay the Surety for all costs and fees.
See our “What is a Surety Bond” Video.
Popular Types of Indiana Surety Bonds
Surety bonds in Indiana generally fall into three main categories, each with specific requirements:
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License and Permit Bonds
These are the most common bonds, often required by state or local agencies as a prerequisite for obtaining a business or professional license. They ensure compliance with licensing laws. Common L&P Bonds Include:
| Bond Type | Bond Amount | Required By (Obligee) |
|---|---|---|
| Auto Dealer Bond | $25,000 | Indiana Secretary of State Dealer Division |
| Collection Agency Bond | $5,000 | State of Indiana |
| Credit Services Organization Bond | $25,000 | Indiana Attorney General |
| Lost Stock Certificate Surety Bond | Varies, Based on the Value of the Stock | Transfer Agency |
| Mortgage Loan Broker Bond | $60,000 | Indiana Department of Financial Institutions |
| Money Transmitter Bond | $300,000 | Indiana Department of Financial Institutions |
If a particular profession does not have a statutory bond requirement but one still wants to “be bonded”, Surety1.com’s surety bond markets offer a Business Service Bond at a very competitive rate. With our secure and easy to navigate online applications, Indiana Surety Bonds can be applied for online in minutes.
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Contract/Construction Bonds
Required primarily in the construction industry, these bonds guarantee that contractors will fulfill the terms of a contract, especially for public works projects.
- Bid Bonds: Guarantees the contractor will enter into the contract if their bid is accepted.
- Performance Bonds: Guarantees the project will be completed according to the contract’s terms and specifications.
- Payment Bonds: Guarantees subcontractors and suppliers will be paid for their work and materials.
Note: Local contractor license bonds (e.g., for Indianapolis, South Bend, or Lafayette) are often required by municipal governments and vary in amount (e.g., $5,000 – $30,000).
Click Here to Apply for a Contractor’s License Bond
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Court and Fiduciary Bonds
These bonds are court-ordered to protect beneficiaries or the court itself from potential financial loss due to a fiduciary’s mishandling of duties.
- Probate Bonds (e.g., Executor, Administrator, Guardian Bonds)
- Appeal Bonds (Supersedeas Bonds)
- Receiver Bonds
How Much Does an Indiana Surety Bond Cost? (The Premium)
The amount of the bond you need (the bond amount or “penal sum”) is set by the Obligee. Your cost, called the premium, is only a small fraction of the total bond amount.
The cost of the surety bond is usually between 1% and 3% of the bond amount, subject to a minimum premium and fees of $150. Surety1 will shop its many markets to procure the right price at the right terms.
Key Factors Determining Your Bond Premium:
- Bond Amount: A higher bond amount generally means a higher premium.
- Credit Score: This is the most significant factor for many bonds. Applicants with excellent credit generally qualify for the lowest rates, Applicants with lower credit scores may pay higher rates, although many bonds are not credit score related.
- Financial Strength: For large contract or commercial bonds, your business’s financial statements and experience may also be reviewed.
- Bond Type: Some bonds are deemed higher risk than others, leading to a higher base rate.
How to Get a Surety Bond in Indiana:
At Surety1.com we make it easy to obtain most surety bonds. Our simple, three step process is:
- Complete the easy to navigate and secure online application. 1
- Review the free, no obligation quote from one of Surety1’s professional surety bond agents, usually within one business day.
- Sign some paperwork and pay the bond premium
Once these steps have been completed, the surety bond will be shipped to the bond principal (applicant).
If you encounter any problems along the way, contact us via email @ info@surety1.com or phone (877)654-2327. Our friendly professional surety bond agents are ready to help.
See our “How does the Surety Bond Process Work” Video
Reasons to Choose a Specialist Like Surety1.com
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Exclusive Focus and Expertise
Surety1.com operates as a surety bond-only agency. Unlike general insurance agencies that sell many types of policies, a dedicated surety agency brings deep, specialized knowledge to the bonding process. See our Blog: Benefits of Working With a Surety Bond Only Agency
- Deep Understanding: They focus solely on surety bonds—Commercial, Contract, and Court, meaning their agents are experts in the specific requirements and regulations of the Indiana state and local obligees (e.g., the Indiana Department of Financial Institutions or local city contractor licensing boards).
- Problem-Solving: This specialization often leads to creative solutions and a higher success rate, especially for complex or “hard-to-place” bonds.
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Access to Competitive Rates (Shopping the Market)
Surety bond rates (premiums) can vary significantly between different surety companies. A key benefit of working with a brokerage is their access to multiple markets.
- Broad Market Access: Surety1.com is licensed nationwide and represents a large network of A-rated surety companies (often 15+ top-tier carriers).
- Best Price: By submitting your single application to multiple underwriters, Surety1.com will shop around to find the most competitive rate and program to fit your specific credit profile and financial standing, ensuring you get the most affordable premium.
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Speed, Convenience, and Digital Efficiency
The bonding process needs to be fast so you can get licensed and start working immediately.
- Fast Online Applications: Surety1.com offers secure, streamlined online applications that simplify the process of getting a quote.
- Quick Approvals: For many standard Indiana license bonds (like Auto Dealer, Notary, or Collection Agency bonds), they often provide fast turnaround times.
- Direct Filing: For bonds managed through systems like the Nationwide Multistate Licensing System (NMLS) for financial services, they can often file the bond electronically, saving you time and hassle.
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Reputation and Reliability
Longevity and external ratings provide a measure of trust in the surety industry.
- Established History: Operating since 2003, Surety1.com has a proven track record in the industry.
- Strong Ratings: We maintain an A+ rating with the Better Business Bureau (BBB), indicating a commitment to excellent customer service and resolving any issues promptly.
- Positive Reviews: Customer testimonials frequently praise our team’s professionalism, speed, and helpful communication throughout the application and renewal process.
Your Next Actionable Step
To get the most accurate information on why they are the right choice for your specific bond, the best next step is to apply for a free, no-obligation quote.
Surety1 was founded in 2003 and helps thousands of clients find the best prices on their surety bonds. We take pride in our work so that we can give you great service. Learn more about Surety1.