Why is a Signs and Advertising Bond Required?

Many municipalities require signs and advertising bonds to:

1. Ensure Compliance: The bond ensures that contractors comply with building codes, zoning laws, and other regulations specific to outdoor advertising.

2. Protect Public Safety: Improperly installed signs can pose safety hazards. The bond holds contractors accountable for proper installation and maintenance.

3. Cover Sign Removal Costs: If a contractor fails to remove a sign when required, the bond can cover the cost of removal.

4. Provide Financial Security: If a business violates laws or regulations, the bond guarantees compensation for any resulting damages or fines.

Without a bond, businesses may face legal consequences, financial penalties, or the loss of their operating license.

How Does a Signs and Advertising Bond Work?

A signs and advertising bond involves three parties:

1. Principal: The business or contractor required to obtain the bond.

2. Obligee: The government agency or municipality requiring the bond.

3. Surety: The bonding company that guarantees the bond and provides financial backing.

If the contractor violates the terms of their bond—such as failing to comply with regulations or refusing to remove a sign—the obligee (local government or affected party) can file a claim against the bond. The surety will investigate the claim and, if valid, pay compensation up to the bond’s amount. The principal must then reimburse the surety for the claim amount paid.

Types of Signs and Advertising Bonds

Here are some examples of specific signs and advertising bonds required by different municipalities:

Philadelphia, PA Outdoor Advertising Bond

• Bond Amount: $5,000

• Ensures compliance with Philadelphia’s outdoor advertising regulations.

• Protects the public from improperly installed or maintained advertising signs.

Wisconsin Nonresident Outdoor Advertising Bond

• Bond Amount: $5,000

• Required for nonresident businesses involved in outdoor advertising within the state of Wisconsin.

Houston, TX Sign Removal Bond

• Bond Amount: $25,000

• Guarantees compliance with Houston’s regulations regarding the removal of signs when required.

Kansas City, MO Sign Hanger Bond

• Bond Amount: Varies

• Required for businesses involved in hanging signs in Kansas City or Wyandotte County.

If you operate in a state or city not listed above, contact Swift Bonds for assistance in determining your local requirements.

How Much Does a Signs and Advertising Bond Cost?

The cost of a signs and advertising bond depends on several factors:

1. Bond Amount: The amount required by the city or state (e.g., $5,000, $25,000).

2. Premium Rate: The cost of the bond is a small percentage of the bond amount, typically between 1-5%.

3. Credit Score: Businesses or contractors with good credit scores usually qualify for lower premium rates.

4. Business History: A stable financial and operational history can reduce costs.

Example:

If your bond amount is $25,000 and your premium rate is 2%, your annual cost for the bond would be $500.

Even if you have less-than-perfect credit, you can still obtain a bond, though your premium may be higher.

How to Get a Signs and Advertising Bond

Securing a signs and advertising bond is a simple process:

Step 1: Determine Your Requirements

Check with your local government or licensing agency to confirm the bond amount and specific requirements for your business.

Step 2: Complete an Application

Submit an online application with a trusted surety bond provider. You’ll need to provide information about your business, financial history, and the required bond amount.

Step 3: Receive a Quote

A bond agent will review your application and provide a no-cost quote based on your creditworthiness and bond needs.

Step 4: Pay the Premium

Once approved, pay the bond premium to activate your bond.

Step 5: Submit Your Bond

Provide the bond to the appropriate licensing or permitting agency to complete your compliance requirements.

Benefits of Signs and Advertising Bonds

For Contractors and Businesses:

• Meet Licensing Requirements: Stay compliant with local regulations and avoid fines or penalties.

• Build Trust: Being bonded demonstrates professionalism and reliability, helping you attract more clients.

• Financial Security: Protects your business against potential legal or financial liabilities.

For the Public and Local Government:

• Consumer Protection: Provides a safety net for damages caused by non-compliance or improper work.

• Accountability: Ensures contractors adhere to local laws and safety standards.

• Public Safety: Guarantees that signs are safely installed and maintained.

Need Help with a Signs and Advertising Bond?

If you’re ready to secure your signs and advertising bond or have questions about the process, Swift Bonds is here to assist. We specialize in helping businesses meet their bonding requirements quickly and affordably.

To apply for your bond, click here for a no-cost quote. Let us help you stay compliant and protect your business today!