Surety Bonds: The Cheap Alternative to Auto Insurance

Do you want to stop paying for liability car insurance? Are you looking to replace other types of insurance with a better financial plan for you? Getting a surety bond for car accident coverage or surety bond insurance to replace other types of regular insurance policies? These policies are for you. 

What are surety bonds? Is a surety bond cost efficient for my situation? Minimum state auto liability coverage premiums are expensive. The price of bonding is significantly lower if you qualify. How are various types of surety bonds different than liability coverage? Read ahead for a detailed guide on surety bonds today.

Surety Bonds: What Are They?
1 of 4 Next

The rising costs of 2021 insurance premiums have many qualified U.S. residents looking for ways to save valuable hard-earned money. Alternatives to regular insurance coverage policies are available, but what are coverage policies and how do coverage policies work? Most U.S. states require all drivers to purchase a minimum amount of liability auto insurance coverage to legally operate a vehicle on public roadways. 

Requiring and backing up this type of financial responsibility are both safe and reasonable ideas for U.S. states. Because almost all drivers are required to purchase minimum liability amounts, however, auto insurance companies are able to dictate prices up to state-regulated limits.

Surety bond companies offer viable alternatives to purchasing liability insurance for qualified drivers. A surety insurance company, as it is sometimes also referred to, sells bonds used to secure a driver’s ability to be financially responsible for damages, repairs and other expenses in the event he or she is at fault in a car accident. 

Various types of surety bonds are available for purposes other than paying for car accident expenses. For example, bonding is also used as an alternative for life insurance and more. What are the main differences between liability insurance and a surety bond? A surety company holds your money in bond until or unless you are required to use it to pay for accident-related expenses. Is there a catch?

Liability insurance covers bodily injury and property damage in specific circumstances. State minimums are in place based on data collected pursuant to state accident statistics and the average amount of damages and/or injuries sustained each year. 

Bodily injury liability pays out to other drivers, passengers and pedestrians who are injured in an accident when you are the at-fault driver. Property damage liability pays out to cover the costs of damage you do to another person’s property. 

Premiums for liability insurance coverage average a little more than $530 per year. A surety bond, which replaces liability coverage, is a promise to pay for damages you cause as an at-fault driver. The minimum value amount of your surety bond must have  at least the same amount as state liability coverage limits in your state.

1 of 4 Next