Question

73. Surety bonds are written for a definite limit called

(Choose from the following options)
1. Loss costs.
2. The bond penalty.
3. Indemnity limit.
4. The limit of liability.

Answer 1

Surety bonds are written for a definite limit called the bond penalty. The bond penalty is the maximum amount that the surety bond will pay out in the event of a claim.

Step-by-step explanation:

Surety bonds are written for a definite limit called the bond penalty. The bond penalty is the maximum amount that the surety bond will pay out in the event of a claim. It represents the maximum liability of the bond issuer.