What type of bond must CIC board members typically post?

CIC board members are typically required to post a fidelity bond. A fidelity bond is designed to protect the community against fraud or dishonesty committed by the board members or designated employees. This coverage ensures that if there are any acts of theft, fraud, or similar misconduct involving the financial assets of the community, the bond will provide compensation for the losses incurred. This is particularly important in the context of Common Interest Communities (CICs) where board members may handle substantial amounts of money and make important financial decisions.

The other bond types may serve specific functions but do not directly relate to the protection against misconduct by board members in a community setting. A performance bond is more focused on ensuring the fulfillment of a contract and is often utilized in construction projects, while a surety bond is a guarantee of obligations and performance, typically found in contractual relationships involving third parties. Understanding why a fidelity bond is essential helps reinforce the importance of accountability and security within community management.