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Surety bonds are assumed to carry zero risk for the company who writes them. The bond outlines the agreement between the principal, surety company, and obligee. It does not include language about the principal reimbursing the surety. The key to issuing bonds confidently is an indemnity agreement. This contract transfers risk from one party to another. The indemnitor assumes the risk, while the surety company is absolved of liability. This agreement is crucial for surety bonds.