When starting a cleaning business, one of the most common questions is, do I need to get bonded or what is bonding insurance?

Many people think that a bond is required to start a cleaning business, but this is not always the case. However, it is highly recommended to purchase a janitorial service bond when starting out in the industry.

This blog post will discuss what it means to have a bond as a cleaning service and how to get one.

Please note the information in this article is for educational purposes only and does not constitute legal advice. Consult with a legal professional to address your specific legal needs.

Bonding insurance provides peace of mind for you and your customers. When you hold a janitorial service bond, your customers are protected from theft by your business or its employees. This gives your clients peace of mind when hiring you and helps build a level of trust and assurance that you are a serious business owner who cares about your clients and their homes.



1. What is bonding and why do you need it as a business owner

When you purchase a bond for your cleaning business, you are essentially providing peace of mind for your clients.

This policy protects your customers from any financial loss they may suffer as a direct result of theft, fraud, or dishonesty on your part or that of your employees.

When an incident occurs, the bonding company will investigate the claim and pay out damages if your company is found liable for criminal acts.

For example, if one of your employees steals from a client, the bond will cover the cost of the damages. This type of coverage is important for businesses that deal with sensitive material or valuables.

The layer of protection gives your clients peace of mind knowing that there is protection in place in case of an unfortunate event.

Your client may feel more comfortable hiring your company over another knowing that you have taken the extra steps to protect their valuables by becoming bonded.

One difference between a bond from an insurance policy is that a claim that is paid by the bonding company has to be repaid. Whereas when an insurance claim is paid against a policy it does not have to be repaid.



2. How much does bonding cost and what are the benefits

The cost of bonding insurance varies depending on the size and scope of your business. For a cleaning business, the average bond purchased ranges from $5,000 to $100,000.

The cost of the bond will vary based on the amount of your bond, your company size, risk factors, where you are located, and other varying factors.

It is a good idea to purchase liability insurance in conjunction with your bond to better protect your business.



3 How to choose the right bonding company for your business

It is important that you do your research when selecting a bonding company as not all are created equal.

When I started my cleaning business, I first got a quote from my car insurance company. I then called around to a few local brokers to get quotes as well.

I ended up working with a local insurance broker who was able to shop around for my business needs.

Insurance Brokers are easy to work with as they can help you shop around for other business insurance as well that will better protect you and your cleaning business.

You can check with your local chamber of commerce to see if there are any registered insurance brokers that you can work with as well.



4. What to do if something goes wrong

Bond insurance for breakage

Hopefully, you will never have to tap into your janitorial bonding insurance while running your business. But in the chance that you do, there are a few things you can do now to be prepared.

When something goes wrong and you need to file a claim against your bond, you will first need to file a police report. Many companies will not pay out a claim without a conviction.

Once you have filed the police report, you will then need to contact your surety company and provide them with a copy of the report.

Your surety company will then investigate the claim and if they find that your business is liable, they will pay out the damages up to the amount of the bond you purchased.

It is important to have a company policy in place in case something happens. Check with your bonding company on what they require for reporting purposes and use this as a guide to create your policy.

It is helpful to create an incident report form where you can record all the information revolving around the claim. As soon as your client reaches out to you regarding a possible theft (do this for damages as well) send them your incident form and have them record when the item when missing, a description of the item, and what value the item may be



5. What happens if you don’t get bonded when starting a cleaning business

In most cases, a bond is not legally required to start a cleaning business. But it is highly recommended to purchase a bond when starting a cleaning business.

1. You may not win the bid

When new clients are getting quotes from cleaning services, it is likely they will ask you if your business is bonded and insured.

The Cleaning Busines that can prove they are, will have a greater chance of getting hired for the job.

Related Article: How to Quote House Cleaning Services

2. You may have to pay upfront when something goes wrong

If something goes wrong and you are not bonded, you may be liable for damages out of your own pocket when they occur. This can put a strain on a small business that may not have the cash to pay out for the loss of expensive items and ultimately ruin your business.

It is not worth the risk of not getting bonded when starting a cleaning business. The peace of mind and protection it provides is invaluable.

I hope this article has helped you understand why it is important to get bonded when starting a cleaning business.



Continue Reading: Insurance Policies your House Cleaning Business may need.

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