What is an indemnity bond with surety?
An indemnity bond with surety is an insurance policy that protects the grand prize winner if they become unable to fulfill their contract.
The indemnity bond with surety is a relatively new requirement in the world of sweepstakes. In past years, there were no requirements to post an indemnity bond when entering sweepstakes. However, over the last several years there has been cracking down on marketers who do not honor their sweepstakes’ rules and prizes or games that are rigged for winners to be disqualified.
After several high-profile cases where marketers did not follow through on their prizes, published a public notice suggesting all promotions include a bond because it provides a money-back guarantee if you win and covers expenses that may arise from fulfilling your prize.
Companies offering free trials or full access to their products/services in exchange for mailing information may require an indemnity bond before you can receive the free trial. To avoid any embarrassment or legal action, be sure to read and follow sweepstakes’ rules and regulations before entering a contest.
Is a surety bond the same as an indemnity bond?
Yes, a surety bond is the same as an indemnity bond. A “surety bond” and an “indemnity bond” are synonymous terms. The person to whom you signed your original contract in legalese as the “obligee,” and the party that provided you with the surety bond in legalese as the “surety.”
The purpose of a surety or indemnity bond is to protect the obligee from financial loss if you fail to meet your contractual obligations. If you do not comply with your obligation under the contract when sued by the obligee for breach of contract, the court will order either specific performance, that you perform the contract as promised; money damages; or if you fail to appear in court, a judgment by default will come against you.
These remedies may not be sufficient to protect the obligee from loss fully. In many cases, an indemnity bond is required of you before your case can proceed because it ensures that the court will have another party with deep pockets standing behind your obligation under the original contract.
What is the purpose of an indemnity bond?
Indemnity bonds protect one party from the possible wrongful acts of another. Companies or contractors can obtain indemnity bonds to protect themselves from financial loss due to a breach of contract by the other party.
For example, let’s say you own a construction company and you hire a plumber to repair your bathroom pipes. Towards the end of the job, however, he breaks some tiles on your floor and leaves without finishing up.
Your insurer allows you to file an indemnity bond claim which will pay for any personal property damage that may occur as a result of his mistake. Thus, if he does not agree to step in and fix your broken tiles then your indemnity bond might reimburse you for it up to a certain dollar limit.
An indemnity bond is also, in most cases, required when one party is responsible for supplying specialized personnel or materials. For instance, if the plumber in the previous example decides to bring his own men with him on your job then you may need to file an indemnity bond claim against him in case anything goes wrong during work. Thus, if something happens to them they are protected by their employer’s indemnity bond.
What is a personal indemnity?
A personal indemnity is a type of insurance policy one buys to protect themselves against liability claims. These indemnities can be for anything but are usually put in place to protect the interests of people making significant purchases or hiring contractors for large projects.
For example, if you went out and purchased an expensive piece of machinery with the intent of using it on your job site, you’re likely going to purchase a fairly extensive personal indemnity policy that will cover any liabilities associated with that piece of equipment.
The most common examples are ones dealing with construction accidents or injuries incurred during home renovation work. If someone was injured on your property due to incomplete steps or otherwise faulty equipment, this type of policy would help pay their medical expenses as well as compensate them for any lost wages they may experience while recovering.
Can family members be surety in indemnity bonds?
Yes, family members are allowed as surety for indemnity bonds. Family Members are Capable of Contributing as Sureties. a person capable of contracting may become a surety. This means that anybody who is at least 18 years old, has the full civil capacity and full mental faculties can be a surety even if they have less than three degrees of affinity with the principal obligor or privy thereto parents, children.
All persons shall be held to have relations inter corresponding with those existing between their parents and their children. There is nothing in the law that prohibits family members from being a surety.