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Bonds

There are two common types of bonds. One is the surety bond; the other is the fidelity bond. A surety bond is a written agreement wherein the surety company obligates itself to a second party (the obligee) to answer for the default of a third party (the principal) in failing to perform specified acts within a stated time. A fidelity bond is an insurance policy which reimburses an employer for losses resulting from dishonest acts of employees.

 

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