Warehouse Bond

A A A

DEFINITION

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

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 cargo in transit. ...
  2. Warehouser's Liability Form

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

    A form of inventory financing in which loans are made to manufacturers and processors ...
  4. Warehouse Receipt

    A receipt used in futures markets to guarantee the quantity and quality of a ...
  5. Warehousing

    1. A procedure whereby a company gradually builds up a holding of shares in ...
  6. Hazard Insurance

    Insurance that protects a property owner against damage caused by fires, severe ...
  7. Warehouse Lending

    A line of credit extended by a financial institution to a loan originator to ...
  8. Homeowners Insurance

    A form of property insurance designed to protect an individual's home against ...
  9. Bond Insurance

    A type of insurance policy that a bond issuer purchases that guarantees the ...
  10. Charles Koch

    Charles Koch is the multibillionaire chairman and CEO of Koch Supply and Trading ...
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

  5. Convertible Bonds: An Introduction
    Bonds & Fixed Income

    Convertible Bonds: An Introduction

  6. Boost Bond Returns With Laddering
    Bonds & Fixed Income

    Boost Bond Returns With Laddering

  7. Asset Allocation In A Bond Portfolio
    Bonds & Fixed Income

    Asset Allocation In A Bond Portfolio

  8. What's the difference between a bank ...
    Investing

    What's the difference between a bank ...

  9. CEO Savvy And Stock's Success Go Hand ...
    Personal Finance

    CEO Savvy And Stock's Success Go Hand ...

  10. 4 Ways To Value A Real Estate Rental ...
    Home & Auto

    4 Ways To Value A Real Estate Rental ...

comments powered by Disqus
Hot Definitions
  1. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  2. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  3. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  4. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  5. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
  6. Re-fracking

    Re-fracking is the practice of returning to older wells that had been fracked in the recent past to capitalize on newer, more effective extraction technology. Re-fracking can be effective on especially tight oil deposits – where the shale products low yields – to extend their productivity.
Trading Center