This Insurance Glossary of Terms is produced and maintained by the National Alliance Research Academy. 
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Contract that guarantees the performance of a contract, as in surety bonding, or protects against the dishonesty of employees, and in fidelity bonding. Unlike many contracts and all insurance contracts that have two parties, a surety bond has three parties: the surety (the guarantor), the principal or obligor, (the one to whom the obligation is owed), and the obligee (the party who owes the obligation).