What does obligee mean

More Definitions for obligee. Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free! Log in Sign Up. Save Word. Definition of obligee. First Known Use of obligee , in the meaning defined above. Learn More About obligee. For every obligee there is a corresponding obligor, the one who is obliged to do something for the former in order to fulfill a promise in the contract. The obligee can be a bank, a credit company, or a person who gets a surety bond to make sure that another person will complete something as contractually promised.

Insurance policyholders are also obligees, insofar as their insurance contract stipulates that they are obliged to pay premiums to the insurance company. The world of insurance can be complicated. Subscribe to the Insuranceopedia newsletter and stay in the know! Access expert content, industry term definitions and answers to your questions from knowledgeable insurance insiders. Arm yourself with what you need to know to keep your assets and your family safe.

By: Kaitlyn Kokoska. Image credits. Word of the Day kind-hearted. About this. Blog Outsets and onsets! Read More. November 08, To top. English Examples. Sign up for free and get access to exclusive content:. Free word lists and quizzes from Cambridge. In the case of contract bonds, the obligee is the party creating the contract — eg. Whoever is designated as the obligee receives financial compensation when valid claims are filed against the bond.

The obligee has several responsibilities. They create the bond requirements, identifying what kind of bond is necessary and how large monetarily it must be. They also hold the bonded party accountable if someone files a claim or the bond lapses.

For example, when someone files a valid claim, the surety bond company pays the obligee, who then pays the individual. The principal must obtain whatever bond the obligee requires.

Once the bond is active, the principal bears the responsibility for paying any claims made against the bond by the obligee. The surety company issues the actual bond and pays any claims made against it, at least initially. After payment is made, the surety company recoups its costs from the principal. Viking Bond Service can help you understand your role in any surety bond agreement. We also offer bonds to satisfy almost any obligee. Fill out an online application or contact us for more information.

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Cost of a Surety Bond. Surety Bond Types. Bad Credit Surety Bond Program. Surety Bond Terminology. Obtaining a Surety Bond. License and Permit. What is a Performance Bond.