Surety Bonds — Minnesota

Surety bonds guarantee your performance.
Without the right bond, you cannot work.

Surety bonds are required by law to hold many licenses, bid on public projects, serve as an executor, and operate in dozens of regulated industries. They are not insurance — they guarantee your promise to perform. We help Minnesota businesses and individuals get bonded quickly.

Get Your Bond Quote Talk to an Agent

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License bonds, contract bonds, court bonds

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Same-day issuance for many bond types

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Local agency — Chaska, MN since 2011

Bonds protect others from your failure to perform — and without the right one, you cannot legally operate.

Unlike insurance that protects you, surety bonds protect the people relying on you. A contractor bond protects the project owner. A dealer bond protects consumers. A probate bond protects estate beneficiaries. The obligee — the party requiring the bond — needs assurance that you will do what you promised.

Cannot bid on public construction projects without bid and performance bonds
Cannot renew your auto dealer license without the required bond
Cannot serve as executor of an estate without a probate bond
Cannot operate as a freight broker without an FMCSA bond
Cannot obtain contractor registration in many Minnesota jurisdictions

The key distinction: if a surety pays a claim on your bond, you must repay the surety. Bonds are credit guarantees backed by your promise to perform. Strong credit means lower rates and simpler underwriting.

Three parties in every bond

Principal (you): Purchases the bond, promises to perform
Obligee: Requires the bond, is protected by it
Surety: Issues the bond, guarantees your performance

Types of Surety Bonds

The bonds Minnesota businesses and individuals most commonly need

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Contract Bonds (Construction)

Bid bonds guarantee you will honor your bid if selected. Performance bonds guarantee you will complete the project per contract. Payment bonds guarantee you will pay subcontractors and suppliers. All three are required on most public construction projects over Minnesota statutory thresholds.

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License and Permit Bonds

Required by government agencies to obtain or renew licenses. Auto dealer bonds ($50,000 required in Minnesota), contractor license bonds, notary bonds ($25,000), collection agency bonds, freight broker bonds ($75,000 FMCSA requirement), and mortgage broker bonds are among the most common.

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Court and Probate Bonds

Required by courts for various proceedings — probate bonds for executors and administrators, appeal bonds to delay enforcement of a judgment, guardian and conservator bonds to protect wards and beneficiaries.

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Fidelity Bonds (ERISA)

Required for individuals handling employee benefit plan funds under ERISA. Protects plan participants from losses due to fiduciary dishonesty. A common requirement for anyone who signs checks, transfers funds, or makes disbursement decisions for a 401(k) or pension plan.

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Customs and Transportation Bonds

Customs bonds are required to import goods into the United States. Freight broker bonds ($75,000) are required by FMCSA for all licensed freight brokers. Motor carrier bonds are required for certain transportation operations.

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Other Commercial Bonds

Health club bonds, employment agency bonds, warehouse bonds, lost instrument bonds, and dozens of other bond types required for specific industries and situations. If you have been asked for a bond and are not sure what type it is, call us.

Minnesota Bond Requirements

Common bond requirements for Minnesota businesses

Bond Type	Who Needs It	Minnesota Amount	Typical Premium (Good Credit)
Auto Dealer Bond	Motor vehicle dealers	$50,000	$500–$1,500/yr
Notary Bond	Notaries public	$25,000	$25–$75/yr
Collection Agency Bond	Licensed collection agencies	$25,000	$250–$750/yr
Freight Broker Bond	FMCSA-licensed freight brokers	$75,000	$750–$2,250/yr
Performance Bond	Public construction contractors	100% of contract value	1–3% of contract
Payment Bond	Public construction contractors	100% of contract value	Typically with performance bond
Probate / Executor Bond	Estate executors and administrators	Varies by estate value	0.5–1% of bond amount

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Minnesota Surety Bond Checklist

Understand bond types, how credit affects your rate, and what documentation the application requires.

Download Free Checklist →

How Bonds Are Priced

Why your credit score matters for surety bonds

Unlike insurance, surety bonds are underwritten like credit. The surety is extending a guarantee on your behalf — and your credit tells them how likely you are to repay any claims they pay. Strong credit means lower rates and simpler underwriting.

Good credit (700+)

Standard rates of 1–3% of the bond amount. Simplified underwriting. Quick approval. Most bond types available without additional documentation.

Fair credit (600-699)

Higher rates of 3–10%. More documentation required. Collateral may be needed for larger bonds. Most bonds still available.

Challenged credit (below 600)

Highest rates of 10–15%+. Collateral typically required. Specialized surety programs available for higher-risk applicants. Bonds may have additional conditions.

Our Process

Three steps to getting bonded

Tell Us What Bond You Need

The bond type, the required amount, and who is requiring it (the obligee). If you have a bond form or requirement document, share it — specific language in the requirement sometimes affects what bond form is needed.

Application and Underwriting

For small license bonds under $50,000, we typically need your basic information and a credit check — same-day approval is common. For larger contract bonds, we collect financial statements, work history, and additional documentation.

Bond Issued and Delivered

Once approved, we issue the bond certificate and deliver it to you or directly to the obligee as required. Many bond types can be issued electronically the same day.

Frequently Asked Questions

What people ask about surety bonds

Insurance protects you from loss — you pay premiums and the insurer pays claims against you. Bonds protect others from your failure to perform — if the surety pays a claim, you must repay the surety. Bonds are credit guarantees, not loss protection.

Often yes, but at higher rates. Specialized surety programs exist for applicants with credit challenges. You may need to provide collateral. Even with a 550 credit score, most common license bonds are obtainable — just at a higher premium.

Simple license bonds are often issued the same day. Court bonds and contractor license bonds typically take 1–3 business days. Large construction contract bonds with full financial statement underwriting take 3–7 business days. If you have a deadline, let us know upfront.

No. Bond premiums are fully earned once the bond is issued. Unlike some insurance, bond premiums are non-refundable regardless of whether any claim is ever made against the bond.

The surety investigates. If valid, they pay the obligee up to the bond amount. You are then legally obligated to repay the surety for the full amount paid. Claims can also affect your ability to get future bonds and may increase your premium at renewal.

Many license and permit bonds are annual and require renewal. You will receive renewal notices from us before the expiration date. Construction contract bonds are project-specific and do not renew. Court bonds remain in force until released by the court.

Get Your Bond

Tell us what bond you need. We will get it done.

License bonds, contract bonds, court bonds, fidelity bonds — we work with multiple sureties to find the right bond at the best available rate.

Multiple surety companies compared
Same-day issuance for qualifying bonds
Programs for challenged credit available
Minnesota-specific requirements understood
Electronic delivery where accepted

Start your bond application

Fill out the form and an agent will be in touch within one business day. For urgent needs, call us directly.

If you have been asked for a bond and are not sure what type or amount you need, call us. We read bond requirements every day.

The language in a bond requirement document determines the specific form needed. Getting the wrong bond type or amount means the obligee will reject it and you will need to start over.

Featured Agent

Carolyn Todd

Commercial Lines Agent

Surety bonds are one of those areas where the specifics matter enormously — the bond type, the form language, the obligee's exact requirements. I work with multiple sureties and I read bond requirements closely before submitting applications. Most common Minnesota license bonds and contractor bonds can be issued within a day or two. If you have a construction project deadline or a license renewal coming up, call us directly and we will prioritize.

(952) 392-9508 carolyn@options-insurance.com options-insurance.com

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Surety bonds guarantee your performance.Without the right bond, you cannot work.