If a principal fails to fulfill their bond obligations, what is likely to happen?

When a principal fails to meet their bond obligations, the surety is typically responsible for stepping in to ensure that the obligation is fulfilled. This means the surety will complete the obligation on behalf of the principal, which can involve paying for the damages or fulfilling the contract requirements that the principal failed to meet. Once the surety has honored this obligation, they will seek reimbursement from the principal, often invoking the indemnity agreement that outlines the principal's responsibility to repay the surety for any losses incurred due to the principal's default. This process safeguards the obligee and maintains the integrity of the bonding system, ensuring that obligations are ultimately met, even if the principal defaults.