Las Cruces Bonds

Complete Guide to Las Cruces, NM Bonds

Find the most affordable bonds for your particular business.


Many businesses and independent contractors in the Las Cruces area purchase business bonds. Whether bonds are required for licensing, mandated as a stipulation of a contracting agreement, or purchased as a form of crime insurance, these bonds play an important role in this New Mexico city.

Whether you are looking to purchase surety bonds or fidelity bonds, a local independent insurance agent can help. These agents can shop around to find the best and most affordable bonds for your particular business. Find an insurance agent in Las Cruces to learn more.

What Are Business Bonds?

There are two types of bonds that business owners in Las Cruces should be familiar with: surety bonds and fidelity bonds. These bonds play very different roles.

  • Surety bonds are designed to protect your clients.
  • Fidelity bonds are designed to protect your business.

You can learn more about each of these types of business bonds by reading below. You can also contact an independent insurance agent in Las Cruces for answers to any questions you my have and for help securing an appropriate bond and a competitive price.

What Is a Surety Bond?

Surety bonds are required for certain businesses before they can be licensed to operate. They can also protect and reimburse your clients in the event that your company fails to meet its contractual obligations. These bonds do not relieve your business of any financial obligations.

A surety bond can best be described as a contract between three parties:

  • You, as the bond holder (referred to as “the principal”)
  • The company providing the bond (referred to as “the surety”)
  • Your client (referred to as “the obligee”)

As the principal, if your business does not act in accordance with the terms established by the bond, the surety will provide the obligee with financial compensation in an amount appropriate to satisfactorily complete the job. Your business will then be obligated to reimburse the surety for their losses.

You should not view your surety bond as an insurance policy. The bond company is there solely for the purpose of guaranteeing compensatory payment to your client, not to you.

What Kinds of Las Cruces Businesses Should Purchase Surety Bonds?

In the state of New Mexico, surety bonds are required in order for certain kinds of businesses to be licensed to operate in this state. In Las Cruces, the following must have surety bonds:

  • Appraisal management companies
  • Construction contractors
  • Independent insurance adjusters
  • Private investigators and detectives
  • Notaries
  • Motor vehicle dealerships
  • Motor vehicle dismantlers

Additionally, contractors are often required by their clients to post surety bonds in the amount of the contractual obligation. That way, the client knows that if they pay a large amount up front and then your company goes bankrupt or fails to do any work, they can get their funds back so that another contractor can do the work.

How Much Do Surety Bonds Cost in Las Cruces, NM?

For the most part, you can expect to pay anywhere from 1% to 15% of the total bond amount. So posting a $10,000 bond can cost anywhere from $100 to $1,500. The actual cost of your surety bond will vary according to factors such as:

  • The amount of the bond you are purchasing
  • The type of bond you are purchasing
  • Your company’s financial standing and creditworthiness

A surety is unlikely to issue a large bond for a company with a weak financial standing and short history of successful job completion. Learn more and get bond quotes from competing sureties by contacting a local independent insurance agent in Las Cruces.

What Is a Fidelity Bond?

While surety bonds protect your customers, fidelity bonds are designed to protect your business. These bonds are considered a form of crime insurance, since they cover against dishonest and illegal actions. They will reimburse your company for losses related to misdeeds committed by your bonded employees.

Covered acts include theft and embezzlement from your company. Similarly, if your bonded employees steal from your clients or use their personal information to commit identity theft or fraud, your fidelity bond will cover the restitution for which your company will be liable.

What Kinds of Las Cruces Businesses Buy Fidelity Bonds?

Las Cruces businesses that may want to invest in fidelity bonds include:

  • Companies that need to have bonded employees in order to acquire a business license
  • Companies that operate in the financial sector, such as banks and credit unions
  • Companies whose employees handle large financial transactions
  • Companies whose employees have access to sensitive customer data
  • Companies whose employees have access to customer assets

If you own a cleaning and janitorial services company and you are trying to win a contract with a large company, if you can say that your employees are bonded, you are more likely to be hired.

This is because in order to be bonded, employees need to pass a background check. Having bonded employees shows potential customers that your workers have been carefully screened and vetted and are therefore less likely to steal from them.

If you are not sure whether a fidelity bond is right for your business, you can consult an independent insurance agent in Las Cruces for advice.

How Much Do Fidelity Bonds Cost in Las Cruces, NM?

The cost to secure a fidelity bond can vary according to a few factors such as:

  • The amount of coverage you are buying
  • The number of employees you have and the types of jobs they do
  • An assessment of the controls your company has put in place to manage risk

Overall, the average cost of a $1 million fidelity bond is a little more than $1,000 a year. Talk to a local independent insurance agent to find out how much it will cost to purchase a fidelity bond for your Las Cruces business.

Why Work with an Independent Insurance Agent in Las Cruces?

If you are shopping for a business bond, an independent insurance agent in Las Cruces can help. These agents can answer your questions and can assist you with finding suitable surety or fidelity bonds at an affordable price.

Contact an insurance agent near you to start comparing customized quotes to get bonds for your Las Cruces business.

Share this page on Twitter Share this page on Facebook Share this page on LinkedIn