Omnibus Clause

[Mr. Bond]

What is an Omnibus Clause?

[Bond Magician]

Originally Posted by Mr. Bond

What is an Omnibus Clause?

Omnibus language covers every known entity, subsidiary, and affiliated or associated entity as exist, as existed in the past, or as may be constituted in the future.

[Mr. Bond]

Bond Magician - can you please rephrase that in layman's terms?

[Bond Magician]

Originally Posted by Mr. Bond

Bond Magician - can you please rephrase that in layman's terms?

In many instances, an omnibus clause or omnibus language is used in indemnity agreements to cover one or more company. A Surety company may require this specific language to be used on an indemnity agreement. The language states that all subsidiaries or affiliates that are owned by the company or are created, controlled, managed or acquired by the company are covered.

[Surety Queen]

Originally Posted by Bond Magician

In many instances, an omnibus clause or omnibus language is used in indemnity agreements to cover one or more company. A Surety company may require this specific language to be used on an indemnity agreement. The language states that all subsidiaries or affiliates that are owned by the company or are created, controlled, managed or acquired by the company are covered.

In many instances, the owner of the company applying for a bond may also own some other companies. If the company looking for the bond is new, and the other companies are quite established and profitable, Surety may allow all companies to indemnity to enable a better rate for the new company.

It's confusing - but Bond Magician's explanation is correct.