License and Permit Bonds, or Miscellaneous Bonds, are typically required by state law and municipal ordanances.  A common example in California is a Contractors License Bond which all contractors must have to do business in California. The main purpose of License and Permit Bonds is to safeguard the public health, welfare, or ensure the public's safety.  The Penal Sums of these bonds are relatively low.  Therefore, if there are many claimants on a single bond, if affords each claimant with little protection.