What Are Surety Bonds, and Do You Need Them?
We often see the phrase “bonded and insured”, but what exactly does it mean? This refers to the process of bonding through surety bonds. Although they are a form of commercial insurance at their core, surety bonds work slightly differently: Generally speaking, they play a different role and fulfil a different objective than other insurance policies by financially guaranteeing that a contract will be fulfilled as originally agreed to by the parties to the contract. Person(s) bonded will:
- remain compliant with a law, regulation, or contract;
- be honest and forthright;
- act with integrity;
- be financially responsible.
Here are three important bond categories:
Commercial surety bonds: Permit, notary, public official, and license bonds are required by law for certain types of companies.
Fidelity bonds: If you own a business, this helps protect you and your clients/customers from employee theft or any act deemed dishonest that results in a financial loss. For example, if a contractor’s employee steals some of a customer’s belongings while on the job, a fidelity bond would cover his and his customer’s losses.
Contract surety bonds: If you’re a contractor, you may need one or more contract surety bonds (which include performance bonds, bid bonds, payment bonds and maintenance bonds). These bond types guarantee that the contractor will honor contract terms, such as what supplies he or she provides, the price for the job, and the work to be performed.
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Real-Time Marketing: A New Level of Customer Interaction
Marketing is usually described as what you say (and how you say it) to convince somebody that your product or service is worth buying. But real-time marketing is something else again. And ad agencies, digital marketers, and PR firms are scrambling to get in on the act, because, apparently, it pays off big time. So, what is it? Real-time marketing is the act of determining what a potential buyer wants right this minute – and pitching it – now! It can range from smartphone coupons to online popup ads and more, all tailored to meeting customers’ immediate needs. A survey by real-time marketing solutions company Evergage found that 76 percent of marketers described it as “personalized content or creative in response to customer interactions.” And some 88 percent of those surveyed noted it is an important component of their 2014 marketing programs. Why? It works. The Evergage study found that “among the marketers that measure the ROI of their real-time marketing, a quarter sees returns of more than 50 percent and nearly as many sees 75 percent ROI.” It’s all about monitoring those customer interactions, and not necessarily through social media. According to a post in iMedia Connection, Evergage CMO Arthur Sweetser notes: “Real-time marketing has grown beyond social media.” Interestingly, the late twentieth-century business guru Peter Drucker may well have been talking about real-time marketing when he said, “The aim of marketing is to know and understand the customer so well [that] the product or service fits him and sells itself.”
Young Entrepreneurs Teach Marketers to Use Social Media
Today’s teenagers spend a lot of time tweeting, Facebooking, and otherwise engaging via social media. A Pew Internet report (2013) on American teens’ usage of the Internet found that:
- 95% of teens (12-17 years) use the Internet.
- Roughly 80% of teens use some form of social media.
- 77% of online teens use Facebook.
- 24% of online teens use Twitter (versus 16% of adults).
According to the Pew study, many users, particularly girls and older teens, visit social networking sites several times a day. They frequently use multiple platforms, including Facebook, Twitter, Instagram, YouTube, Tumblr, Google Plus, Pinterest, Snapchat, Vine, and others for a variety of purposes. Now some enterprising young entrepreneurs have figured out how to capitalize on their own knowledge, experience, and skill in using social media to help businesses define and execute their social media marketing strategies. Fifteen-year-old Lane Sutton, for example, consults with a number of small businesses and has been featured on CNN, Forbes, the Wall Street Journal, Adweek, Fox Business and other media outlets. Sutton, who began social media consulting at 13, advises clients to use social media as an engagement and conversation channel and emphasizes inbound marketing strategies that personalize and humanize marketing efforts. Another company, the Dash Agency, was founded by high school friends Christian Lunny and David Bell. These two teens help companies tailor their marketing messages through Facebook, Instagram, Twitter, Snapchat, and more. They’ve worked with established companies such as Aveda Canada and the Boyd Group, as well as startups and solopreneurs. Now that social media has become embedded in the marketing mix of most organizations, young entrepreneurs are showing even seasoned marketing professionals just how to maximize its power and potential.
At Risk of Liability Lawsuits? You Need This
If you’re a business owner, you likely already know the value of liability insurance, because – unfortunately – you’re probably a target for lawsuits. This is crucial considering the litigious society we live in; more than 15 million civil lawsuits are filed annually, and one of three small business owners have been sued or threatened with lawsuits. So how do you prepare for a time when you may be on the receiving end of a lawsuit?
Excess liability insurance
You obviously need commercial insurance coverage. However, to be truly prepared, there’s another policy you also may need – excess liability coverage, or “umbrella liability.” It offers $1 to $5 million – sometimes $10 million – of liability coverage in addition to the liability limits of your existing commercial insurance policies (including general, professional, and employers’ liability, as well as hired or non-owned commercial auto liability.)
Aren’t my commercial liability limits sufficient?
First, liability limits of those policies may have exclusions, so certain claims may not be covered. Excess liability insurance may help fill those gaps, but more importantly, this policy extends liability coverage from existing commercial policies is usually grossly inadequate when compared to the current costs of commercial lawsuits, claims, and judgments. One claim (and the legal fees) can put your business into bankruptcy unless you have very deep pockets. Excess liability could save your business should you exhaust the limits on your other commercial policies. Granted, not all lawsuits ask for millions of dollars; the numbers depend on the business type and claim. But here’s one liability lawsuit scenario that could apply to most small businesses: Say the court awards $1.5 million in damages to the claimant. However, your professional liability has a $1 million limit. Excess liability would kick in and pay the remaining $500,000.