Surety bonds are financial securities issued by bonding or insurance companies to protect a principal in the event that it fails to fulfill its obligations or causes financial loss to a third party.
A Surety Bond is a contract that’s among at least three parties:
- Importer (Principle) – Pays the duty
- US Customs (Beneficiary) – Receives the duty
- Insurance Co (Surety) – Guarantees the importer pays US Customs
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