Express Scripts is now requiring some applicants who wish to contract with them to furnish a $500,000 performance bond for at least the first two years of the contract. This bond, per Express Scripts, “guarantees to the obligee (Express Scripts) that the principal will carry out the performance of their contract according to terms and conditions agreed to by the parties.” Express Scripts may also require that the bond extend beyond the initial two-year period. These bonds are very expensive and difficult to obtain. The cost of such a surety bond depends on the pharmacy and its owners’ creditworthiness, but is still very high, and can easily exceed $15,000.
What is a Surety Bond Obligee? See more at https://swiftbonds.com/performance-bond/
About A Surety Bond Obligee
The Obligee to any surety bond is the party that receives the benefit of the bond. In a contractual situation, this is the owner of a project. Thus, if the general contractor is unable to perform, then the Obligee can look to the surety to make it whole.
The Obligee is the party that requires the Obligor (the general contractor) to get the bond. That way, if the Obligor is unable to perform under the terms of the agreement, then the Obligee can be assured that they can get another party to finish the project or get paid damages. This reduces their risk considerably.
In any governmental contract, the federal government or municipality is the Obligee.
via Blogger Surety Bond Obligee