Business Service Bonds

Protect your clients, build trust, and safeguard your business — online in minutes.

What Is a Business Service Bond?

A business service bond is a type of fidelity bond that protects your clients if one of your employees steals money, securities, or property from them. It reinforces trust in your business since they know that if theft happens, they can file a claim against the bond.

If your employees handle clients’ property or sensitive information, a business service bond is a simple and affordable way to build trust with customers.

Some of the types of businesses that use service bonds are:

Janitorial services
Landscapers
Cannabis businesses
Fitness instructors — and more

How Does It Work?

If a client believes one of your employees stole from them, they can file a claim against your business service bond. Here’s what to expect:

Your client notifies the bond company and files a claim
The bone company notifies you
You respond to the claim and provide any applicable evidence
The bond company determines to confirm or deny the claim
If approved, the bond company repays the client up to the bond limit
You repay the bond company

What Does a Business Service Bond Cover?

If an employee takes client property, a business service bond can quickly reimburse your client and protect your reputation and relationship in the process.

If an employee steals cash from your client’s wallet while cleaning their home

Our bond partner can pay the client back for the stolen money.

If a technician steals a client’s laptop while performing work

Our bond partner can compensate the client for the stolen device.

If a contractor takes a client’s high-end drill from their property

Our bond partner can reimburse the client for the stolen equipment.

How much your bond will cover (e.g., the limit of your bond) depends on the size of your business and the value of what you’re protecting. In general, small businesses often pick $10,000 to $25,000. Bigger operations may need limits of $100,000 or more.

How Much Do Business Service Bonds Cost?

Business service bond premiums typically range from 1% – 5% of the bond amount. For a $10,000 bond, expect to pay between $100 and $1,500 annually.

Business service bond costs aren’t one-size-fits-all. Take a look at what shapes the price.

Coverage amount: The larger the bond limit amount, the higher the premium.
Risk level: Bonds considered higher risk often come with steeper premiums due to the possibility of claims.

Who Needs a Business Service Bond?

We recommend your business have a business service bond in place if your employees have access to clients’ property, money, or sensitive information, like bank records.

Professions we offer Business Service Bonds for

Bakers
Performers
Cleaners
Consultants
Auditors
Vendors
Educators
Mobile food and beverage
businesses
Pet groomers
Pet sitters
Pet taxi providers
Photographers and videographers
Pooper scoopers (pet waste removal businesses)
Dog trainers
Dog walkers
Chefs and caterers
Chimney sweeps
Face and body painters
Health and wellness professionals
Home-based food and beverage businesses
Interior designers
Acupuncturists
Bodywork professionals
Energy workers
Nail techs
Hair stylists
Massage therapists

Professions we cover, but may need more than a Business Service Bond

Barbers
Cannabis
Cosmetologists
Estheticians
Financial services businesses
Fitness instructors
Food and beverage vendors
Food Manufacturers
Health and wellness professionals
Lawn care and landscaping businesses
Legal services
Real estate agents
Restaurants
Salons and spas
Wood and metal crafters

How to Apply for a Business Service Bond

Getting your business service bond is easy with Insurance Canopy:

Pick your bond: Choose the right bond amount for your business needs. Most small businesses go for a bond limit of $10,000 to $25,000 but pick what makes sense for your client’s requirements or the job at hand.
Finalize payment: Complete your payment.
Seal the deal: Get your bond confirmation. Easy and done!

Questions About Business Service Bonds

Is bonding the same as insurance?

Insurance and bonding aren’t the same. Insurance protects your business from the financial fallout of specific covered risks, like third-party injuries and property damage. Bonds protect your clients should you not be able to fulfill your contract or if your employee steals from them (depending on the type of bond).

What is the difference between a surety bond and a business service bond?

A surety bond is a broad term for an agreement where one party guarantees the actions of another. A business service bond is a type of surety bond that protects your client if an employee steals from them, covering the cost of the items up to the bond’s limit.

Do I need a bond if I’m a sole proprietor with no employees?

Even if you’re a sole proprietor with no employees and work directly with clients, you need a business service bond to meet contract requirements, comply with regulations, or show professionalism when securing work.

What happens if I can’t afford to pay for a claim made against the bond?

If a claim is made against your bond, the bond (surety) company will pay it. Then, you’re required to reimburse the bond provider based on the terms outlined in your bond indemnity agreement. If you can’t afford to repay it all at once, the bond company may offer options, such as:

Repayment plans: Some surety companies offer payment plans to make repayment more manageable
Interest rates: Interest may be applied depending on the terms of your agreement
Repayment timeframe: The timeframe for repayment will be specified in the indemnity contract

If you fail to repay, the surety company may take legal action or report it, impacting your credit. So review your bond terms carefully and discuss repayment options with your surety company.

Do bonding requirements differ per state?

Yes, bonding requirements can vary by state and industry. Some states may have specific rules, while others may not require a bond at all. Check your state’s requirements to stay compliant