Warehouse Bond

AAA

DEFINITION of 'Warehouse Bond '

A type of financial protection that assures an individual or business keeping goods in a storage facility that any losses will be covered if the facility fails to meet the terms of its contract. If the warehouse owner or operator fails to meet its obligations, a third party company called a surety will act as an intermediary and compensate the client for his or her loss.

INVESTOPEDIA EXPLAINS 'Warehouse Bond '

State governments often require warehousers to be bonded. They also establish financial requirements for bonding. For example, the state of Massachusetts requires all public warehousemen to be licensed and bonded, and the bond requirement is $10,000 per warehouse. Bond requirements can vary depending on the type of warehouse (e.g., grain warehouse, eviction warehouse, public warehouse).

RELATED TERMS
  1. Warehouse-To-Warehouse Clause

    A clause in an insurance policy that provides for coverage of ...
  2. Warehouser's Liability Form

    A document that describes the obligations of a storage facility ...
  3. Warehouse Financing

    A form of inventory financing in which loans are made to manufacturers ...
  4. Bond Insurance

    A type of insurance policy that a bond issuer purchases that ...
  5. Warehouse Receipt

    A receipt used in futures markets to guarantee the quantity and ...
  6. Warehousing

    1. A procedure whereby a company gradually builds up a holding ...
Related Articles
  1. Bond Call Features: Don't Get Caught ...
    Bonds & Fixed Income

    Bond Call Features: Don't Get Caught ...

  2. The Advantages Of Bonds
    Investing

    The Advantages Of Bonds

  3. Corporate Bonds: An Introduction To ...
    Bonds & Fixed Income

    Corporate Bonds: An Introduction To ...

  4. The Bond Market: A Look Back
    Mutual Funds & ETFs

    The Bond Market: A Look Back

comments powered by Disqus
Hot Definitions
  1. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  2. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  3. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  4. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  5. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
  6. Over The Counter

    A security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" ...
Trading Center