Why 5% or more?

[Bond Artist]

I was told that one of the underwriting requirements is that each owner with more than 5% ownership of the company comes into play. Why is it 5%, why not 20% for example?

[Admin]

Most carriers feel that 5% is a good number to cut it off at. I am not sure specifically why most seem to choose 5% rather 10% or 20%, but I guess they feel that is a good cut-off point.