D.C. Mun. Regs. tit. 27, r. 27-2799
When used in this chapter, the following terms and phrases shall have the meanings ascribed:
Attorney-in-fact - an agent, independent agent, underwriter, or any other company or individual holding a power of attorney granted by a surety.
Bid bond - a bid security in the form of a bond.
Bid security - a form of guarantee assuring that the bidder or offeror will not withdraw a bid or proposal within the period specified for acceptance and will execute a written contract and furnish required bonds or other security, including any necessary coinsurance or reinsurance agreements, within the time specified in the solicitation, unless a longer time is allowed, after receipt of the specified forms.
Bond - a written instrument executed by a bidder or contractor (the "principal"), and a second party (the "surety" or "sureties"), to assure fulfillment of the principal's obligations to a third party (the "obligee" or "District"), identified in the bond. If the principal's obligations are not met, the bond assures payment, to the extent stipulated, for any loss sustained by the obligee.
Corporate surety - a corporation licensed under District insurance laws which, under its charter, has legal power to act as surety for others.
Co-surety - one (1) of two (2) or more sureties that are jointly liable for the penal sum of the bond. A limit of liability for each surety may be stated.
Consent of surety - an acknowledgment by a surety that its bond given in connection with a contract continues to apply to the contract as modified.
Direct writing company - the surety actually executing the bond or other security (as opposed to a source of reinsurance or secondary underwriter).
Executed - agreed to and signed by the parties to a transaction.
Individual surety - a natural person, as distinguished from a business entity, who is liable for the entire penal amount of the bond.
Insurance - a contract which provides that, for a stipulated consideration, the insurer undertakes to indemnify the insured party against risk of loss, damage, or liability arising from an unknown or contingent event.
Payment bond - a bond that ensures payment as required by law to all persons supplying labor or material in the performance of the work provided for in the contract.
Performance bond - a bond that secures performance and fulfillment of the contractor's obligations under the contract.
Penal sum or penal amount - the amount of money specified in a security (or a percentage of the bid price in a bid security) as the maximum payment for which the surety is obligated.
Power of attorney - the authority given to a person or corporation to act for and obligate another as specified in the instrument creating the power. In corporate suretyship, an instrument under seal which appoints an attorney-in-fact to act on behalf of a surety company in signing bonds.
Reinsurance - a transaction which provides that a surety, for a consideration, agrees to indemnify another surety against loss which the latter may sustain under a bond which it has issued.
Risk-pooling arrangements - arrangement by which the risks of underwriting any security are shared by two or more securities.
Surety - a party legally liable for the debt, default, or failure of a principal to satisfy a contractual obligation.
Underwriting limitation - the maximum amount for which a surety can be liable under a bond or other security.
D.C. Mun. Regs. tit. 27, r. 27-2799