Surety Bonds
What Is the Difference Between Bonded and Insured?
Bonded means a surety company guarantees your performance or licensing obligations. Insured means you have insurance coverage against losses. They protect different parties and serve completely different purposes.
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What is the difference between being bonded and insured?
Being insured: your GL policy protects third parties from injury or property damage you cause. Your workers comp protects your employees. Your commercial auto protects against vehicle accidents. Insurance pays covered claims without recovery from you.
Being bonded: your surety bond protects the party requiring it — a licensing board, project owner, or subcontractors — against your failure to perform. If a claim is paid, the surety recovers the full amount from you.
Most contracts and licensing requirements demand both. ‘Licensed, bonded, and insured’ is the standard trio for legitimate contractors. Each element serves a distinct protective function.
Need a surety bond fast?
Trade Safe helps contractors get bonded same-day in most cases. We work with multiple surety markets to find the best rate for your situation.