ACORD 55 (Commercial Surety Bond)
An ACORD form specifically designed for commercial surety bond applications, covering license, permit, and miscellaneous bond types.
What It Is
The ACORD 55 is the application form specifically for commercial surety bonds, which are distinct from contract surety bonds. Commercial surety bonds include license and permit bonds, fiduciary bonds, public official bonds, court bonds, and miscellaneous bonds required by statute or regulation.
The form captures the principal's information, the type of commercial bond, the obligee (typically a government agency or court), the bond amount, and basic financial information about the principal. Commercial surety bonds generally have lower penalty amounts and simpler underwriting than contract bonds.
The ACORD 55 is commonly used for bonds required to obtain business licenses, alcohol permits, freight broker bonds, and other regulatory compliance obligations.
Why It Matters for Brokers
Commercial surety bonds are a high-volume, low-premium product line that many brokerages handle alongside their commercial P&C business. Clients frequently need license bonds, permit bonds, and other regulatory bonds as a condition of doing business. Brokers who can efficiently process ACORD 55 applications provide a valuable ancillary service. The margin on individual commercial bonds is small, but the cumulative revenue and client retention value makes this an important product line.
Real-World Example
A freight broker needs a $75,000 BMC-84 surety bond to maintain their FMCSA operating authority. The broker completes the ACORD 55 with the freight broker's entity information, the FMCSA as the obligee, and the $75,000 bond amount. The surety carrier approves the bond based on the principal's credit score and financial review, and the bond is filed with the FMCSA within 10 days.
Common Mistakes
- 1Using the ACORD 50 (contract surety) when the ACORD 55 (commercial surety) is the correct form for license and permit bonds.
- 2Not verifying the exact bond form number and obligee required by the regulatory agency, which can cause bond rejection.
- 3Failing to track bond renewal dates, allowing bonds to lapse and putting the client's license or permit at risk.
How brokerageaudit.com Handles This
BrokerageAudit tracks commercial surety bond expirations and triggers renewal workflows through the ACORD 55. The platform maintains a library of common bond requirements by state and industry.