All of the following statements about a surety are true EXCEPT

A) A surety theoretically expects no losses to occur.
B) The principal is the party who agrees to answer for the debt, default, or obligation of another party.
C) The surety has the legal right to recover a loss payment from the defaulting principal.
D) There are three parties to a surety bond: the principal, the surety, and the obligee.

Answer: B