$5,000 Town of Hempstead Openings into Sewers and Drains Bond

Businesses are required to file a $5,000 bond with the Town of Hempstead (the "Obligee") to activate their license. The bond protects the Obligee by transferring to a surety bond company the cost of ensuring the public is compensated for damages resulting from a licensed business breaking licensing laws.

Openings into Sewers and Drains Bond

State/Jurisdiction:
Classification:

How much does the Town of Hempstead Openings into Sewers and Drains bond cost?

Town of Hempstead Openings into Sewers and Drains bonds cost $100.

Is a Credit Check Required for Town of Hempstead Openings into Sewers and Drains Bonds?

Credit checks are not required for the Town of Hempstead Openings into Sewers and Drains bond.

Why is the Town of Hempstead Openings into Sewers and Drains bond required?

Businesses are required to purchase and file a $5,000 bond with the Town of Hempstead to activate their license. The bond protects the Obligee by transferring to a surety bond company the cost of ensuring the public is compensated for damages resulting from the failure of a licensed business complying with the provisions of licensing laws.

How does the Town of Hempstead Openings into Sewers and Drains bond work?

Town of Hempstead Openings into Sewers and Drains bonds must be issued by an insurance carrier admitted by the NY Department of Insurance. The insurance company issuing any surety bond, such as the Town of Hempstead Openings into Sewers and Drains bond, will also be referred to as the “surety company” or the “bond company”. The business is referred to as the Principal, the surety bond company as the Obligor and the Town of Hempstead as the Obligee.

The surety company provides the Obligee a guarantee (the surety bond) that the customers, vendors and employees of a licensed business will receive payment for financial damages due to a violation of licensing law up the bond amount stated on the bond form (“penal sum”). The bond company also directly receives claims from the public and determines the validity of claims. Ultimately, the licensed business owners are responsible for their actions and required by law to reimburse the surety company for any payments made under the bond or face indefinite license suspension.