Insurance & Bonding, Part 2: Bonding
Continued from Insurance & Bonding, Part 1: Courier Insurance
Bonding is often mistaken for courier insurance, but is a radically different issue. Bonding is simply a sort of insurance taken by the business owner in the event that a crime is committed by an employee of the courier service. Courier insurance will cover the replacement costs of the goods should they be lost or stolen during transit.
For example, let’s say that a medical center hires the courier service to transport a container of highly controlled drugs. On the way to the location the driver decides to remove some of the medicines, and the loss is discovered a day or two after the delivery. While there will be legal and financial implications around such an event, the fact that the courier service owner is bonded will automatically allow the client a full financial reimbursement for their losses.
Do you need to be bonded? It all depends upon the types of goods your courier service transports, and the viability of any theft occurring. If you are a self-employed courier who would never consider tampering with any client parcels it is not likely that bonding is going to be necessary in the least.
If, on the other hand, you find that you must entrust some of your deliveries to subcontractors or seasonal employees with whom you may not have an extensive history, then it might be a wise idea to purchase some bonding.
Bonding provides you with a two-fold level of coverage because your clients can be absolutely assured that they are under no financial risks when their packages are in your hands, and that there is no issue for which your courier company is going to be financially liable as well.
In many cases, bonding and courier insurance will qualify as tax-deductible business expenses.