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Bonds are a written agreement in which one party, the surety, guarantees the performance or honesty of a second party, the principal (obligor), to the third party (obligee) to whom the performance or debt is owed.
WHAT ARE FIDELITY BONDS?
Fidelity Bonds are bonds designed to protect against dishonesty. Generally, the bond protects against the dishonesty of employees. These bonds cover losses arising from employee dishonesty and indemnity, the principal for losses caused by the dishonest actions of its employees.