There are generally two types of bonds offered by insurance companies:

• Surety: these bonds guarantee the performance of a task by the bonded person (also known as "performance bonds").
• Fidelity: these bonds guarantee the honesty of the bonded person.

Bonds purchased through the OSBA bond program provide a combination of surety and fidelity coverage. (i.e. they guarantee the honesty and performance of a task.) OSBA bonds state that the principal will “faithfully perform the duties of their office.”

Districts may purchase the following:

• Treasurer Bonds ($6 per $ 1,000 of coverage)
  The treasurer bond is issued in the treasurer's name. They are required by ORC Section 3313.25: "Before entering upon the duties of his office, the treasurer of each board of education shall execute a bond in an amount and with surety to be approved by the board, payable to the state, conditioned for the faithful performance of all the official duties required of him. Such bond must be deposited with the president of the board, and a copy thereof, certified by him, shall be filed with the county auditor." The bond must cover the length of the Treasurer's contract. If a new or interim Treasurer is hired, the name must be changed on the bond.
• Position Bonds ($2 per $1,000 of coverage)
  These bonds cover persons in positions specifically identified by the school district on the bond application (i.e. superintendent, board president, secretaries; any employee except the treasurer; excludes volunteers such as PTA members).

If the bonded person ("principal") fails to meet his obligations, the insurance company is liable up to the limit of the bond. The rights of the principal are subrogated to the insurance company. This means that the insurance company can attempt to recover the loss.

Member benefits

• Fulfills a requirement for schools

Endorsed Programs
Services OSBA



©Ohio School Boards Association, 2004