A Continuation Certificate for a surety bond is a document issued by the surety company that extends the bond's coverage for an additional term. It confirms that the bond remains in effect beyond its original expiration date without requiring a new bond.
Purpose of a Continuation Certificate
- Ensures ongoing compliance with legal or contractual bonding requirements.
- Verifies that the principal (the bonded party) continues to have financial backing from the surety.
- Avoids gaps in coverage that could result in penalties or loss of licensure.
When is a Continuation Certificate Needed?
- Many surety bonds, especially license and permit bonds, contract bonds, or court bonds, are issued on an annual basis. Instead of issuing a new bond each year, a continuation certificate extends the current bond.
- Some obligees (the entity requiring the bond) accept continuation certificates in place of a completely new bond.
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