Why is my premium due so early?

[Redbull]

I recently got an invoice saying that payment is due by the end of the month, but the bond doesn't expire until the end of next month. Why is that?

[Admin]

Bonds are not like insurance, as they typically have cancellation clauses or 30-120 days. This means that 30-120 days notice must be given prior to cancellation. Therefore, if there is a 30 day cancellation clause, the surety is on the hook for 30 days AFTER the obligee receives the cancellation notice.

In other words, if we were to wait until the day of expiration to cancel it, you would get X amount of days of premium for free.