Which of the following statements is correct with respect to bonding?
A)Bonding provides protection against losses incurred because of fluctuations in the financial markets.
B)Bonding provides protection to the victim injured by the wrongful conduct of the person bonded.
C)Bonding is a government certification system whereby the government guarantees that a person so bonded or certified will do the job he is hired to do as set out in the bonding certificate.
D)If a person is bonded and that person commits some wrongful act such as stealing a client's money,the bonding company is bound to compensate him for any losses he suffers from being caught.
E)Bonding is another term for insurance.The two terms,bonding and insurance,are interchangeable.

Question

Quizplus · Accepted Answer

Bonding is a type of insurance that provides protection for the victim of wrongful conduct by the person who is bonded. It helps to ensure that the victim can recover any losses incurred as a result of the wrongful act. Bonding does not provide protection against financial market fluctuations (A), nor is it a government certification system (C). Bonding companies are not bound to compensate wrongdoers (D), and while bonding is related to insurance, the two terms are not interchangeable (E).

Which of the Following Statements Is Correct with Respect to Bonding