![]() Finally, Jet is the only carrier to offer monthly payment options on surety bonds. Also, Jet conducts a tremendous amount of research before offering a bond, making the process as smooth and streamlined as possible, so you can bet that Jet’s offer will save you time and money. If you’re in the market for a court bond, a performance bond, or a fidelity crime bond, just to name a few, expect the process to take days or even weeks with middlemen involved.Īt Jet, all bonds are quoted, billed, and issued automatically online. After the agent collects your premium (and fees), the middleman must go back to the carrier to issue the bond. ![]() Then the agent will have to wait for the carrier to (hopefully) approve and provide a premium rate. Depending on the carrier, the agent or broker may need you to complete, sign, scan, and send a special application for that carrier. First, the agent or broker must collect your information and decide which insurance company has the appetite for the bond and your business or personal profile. In addition to the money absorbed by agents and brokers, the presence of a middleman creates substantial delays and extra work in the process of obtaining a bond. Takeaway: if you want to avoid the myriad fees charged by brokers, cut out the middleman and buy direct from Jet. Agents and brokers are much less regulated, especially when selling insurance to businesses as in most surety bond transactions, and can often tack on fees with simple disclosures. All carriers must do this, but Jet is unique in that it sells surety bonds directly to the customer of the bond so you are guaranteed to only pay what’s in Jet’s rate filing because you interact directly with us. Need your bond shipped to you right away? You guessed it - more fees.Ĭarriers like Jet must justify to regulators any fees charged to customers in an arduous process known as a rate filing. Want to reinstate your bond after canceling? There’s a fee for that too. Need to cancel your bond? There’s a fee for that. The only way to sustainably lower the price of an identical product like a surety bond is to reduce expenses, and agents’ commissions represent the single largest expense in the surety bond process.īroker fees aren’t the only fees charged by insurance agents and brokers on surety bonds. We’d rather just give you a low price that isn’t stuffed with a big commission. So you pay them to find you a lower price, one that is hopefully low enough to offset their added fees. Surety agents and brokers typically justify broker fees because they’re shopping the rate on your behalf. Surety brokers simply need to help you identify the correct form (not for nothing, but we think the 40% commission more than covers that effort). While there are thousands of different surety bonds, you only need one specific bond to satisfy a given requirement, and the carriers who offer it all use the same bond form. At least with insurance policies, the agent can help the client understand the strengths and weaknesses of the various policies offered for the type of insurance needed and select the right policy to manage the unique risks of the customer. Most insurance contracts aren’t negotiated - the insurance carrier writes the contract and the prospective insured buys the policy or does not. Surety bonds are required, typically by government entities issuing a license, contract, or waiver, so there is much less value for an agent to provide.Īccording to Merriam-Webster, a broker in the insurance context is an agent who negotiates contracts. ![]() Insurance policies are drafted by the carrier and protect the buyer of the policy so agents can assist their customers in understanding the coverage offered and tailoring a policy, or sometimes a collection of policies from various carriers, to suit their needs. Unlike many forms of insurance, surety bonds are drafted by the Obligee, the entity requiring the bond, so there is usually no differentiation in the protection offered in the legal contract. We’re not suggesting agents cannot add value to the insurance buying process, but 40%?!! Also, let’s consider the nature of a surety bond. You heard that right! Almost half, and in some cases more than half, of the money you pay to purchase a surety bond goes to a middleman with no skin in the game. Surety brokers are commonly paid commission rates upwards of 40% of the premium you pay. The single largest benefit of cutting out the middleman is removing the massive commissions paid to agents and brokers. Ever Hear the Joke About the Surety Broker on Welfare?
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