What is a Business Services Bond?

Business services bonds are the most common form of the broader category of fidelity bonds, providing protection should an employee steal from the customer’s of the business purchasing the bonds (the “insured”). Business services bonds are often referred to as “dishonesty” or “employee dishonesty bonds”; however, it’s important to distinguish the coverage offered by a business services bond versus a traditional employee dishonesty bond. Business services bonds cover loss resulting from theft of the insured’s customer’s property by an employee while on the client’s premises. Employee dishonesty bonds cover loss resulting from theft of the insured’s property by an employee and may also include the same coverage provided by a business services bond along with other available coverages. 

Business services bonds are most often needed for businesses that perform services on their customer’s premises. Janitorial services companies, handyman construction services and in-home medical providers are the most common business types that require a bond.

Why is a Business Services Bond needed?

Business services bonds may be required when a business enters into a contract with a customer to perform services on the customer’s premises. In addition, many businesses purchase business services bonds to protect the business owner and his/her customers from theft of customer property. 

How much does a Business Services Bond cost?

Business services bonds cost as low as $100 per year. Rates are determined based on the amount of coverage purchased and the number of employees working for the insured. 

Example: Business Services Bond Rate Chart

Amount of Coverage

# Of Employees $5,000 $10,000 $25,000 $50,000 $75,000 $100,000
5 or less $100 $126 $187 $257 $320 $359
10 $134 $181 $265 $359 $437 $483
15 $173 $235 $343 $460 $554 $608
20 $212 $290 $421 $561 $670 $733
25 $251 $345 $499 $663 $787 $858


Is a credit check required for Business Services Bonds?

Credit checks are not required to purchase business services bonds.

Who is protected under a Business Services Bond?

Business services bonds protect the insured from losses resulting from employees of the insured stealing from customers. The surety company will pay the insured for losses proven to be the liability of the insured. The policy allows the surety company to attempt to recover losses paid from the employee who committed the fraudulent or dishonest acts.