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California legally requires a variety of individuals, contractors, and organizations to secure surety bonds to conduct business across the public service industry. Apply for a California Surety Bond today! Single Source Insurance is a leading California bonding company providing bonds with a convenient online application system. Browse the most common types of bonds in this state, or contact us for a full list.
A California Lost Instrument bond gives individuals and organizations a way to replace valuable instruments that have been lost. �Instrument� refers to valuable items like stock or bond certificates, checks, money orders, certificates of deposit, and the like. These are all instruments that could be found and redeemed by someone other than the rightful owner.
Purchasing a Lost Instrument bond is usually the only way you can obtain a duplicate, replacement instrument from the issuer.��It provides financial protection for the issuer if someone suffers a loss or expense as a result of you having been given a replacement instrument.
The concern is that you or someone else will find the instrument and cash it after a replacement has been issued. The bond is your guarantee to make the issuer whole if this should happen.
If you�re applying for a replacement for a lost financial instrument, you�ll most likely need to purchase a Lost Instrument bond. The issuer of the replacement instrument will tell you whether you need a bond with a fixed penalty or an open penalty.
A fixed penalty lost instrument bond has a penal sum (the maximum amount that will be paid out on claims) that is a specific dollar amount—usually 1.5 times the value of the lost instrument. This is what’s normally required when the lost instrument has a fixed value—for example, a cashier’s check or money order.
An open penalty lost instrument bond’s penal sum fluctuates because the value of the lost instrument, such as a stock certificate or variable rate whole life insurance policy, can increase or decrease over time. The penal sum of the bond is determined only when a claim is filed and is directly related to what the lost instrument is worth at that point in time.
Any party who is financially harmed because you were issued a replacement instrument that you should not have been given can file a claim against your Lost Instrument bond to recover damages.
It�s common practice for a surety bond company to pay a lost instrument bond claim on behalf of the bonded individual (the �principal� in the surety bond agreement) and then collect reimbursement.��In essence, any surety bond acts as a line of credit that is used to cover claims and is repaid, often in scheduled installments, by the principal. Repayment is not optional, as the principal is solely responsible for claims payments.
Your cost to purchase a Lost Instrument bond of $5,000 or less is typically a flat $100. For bonds larger than $5,000, the cost is typically $20 per additional $1,000, making the premium for a $10,000 Lost Instrument bond $200.
Request a convenient online quote today, or call to speak with one of our surety bond experts about the California Lost Instrument surety bond you need.
