Bonding

{
  "id": "MLC-T-INS-000591",
  "term": "Bonding",
  "field": "Insurance and risk management",
  "definition": "The process by which a surety company provides a guarantee to an obligee that a principal will perform a specific obligation or contract. It involves assessing the principal's financial stability, experience, and character to determine their eligibility for a bond. Bonding is common in construction, where performance bonds assure project completion and payment bonds guarantee subcontractor and supplier payments.",
  "url": "https://mlchart.com/terminology/insurance/bonding/"
}