Surety Bonding for the Small and Specialty Contractor

In business, as it is in life, the people who are successful are those who are most able to adapt to change in a positive way. As the Surety marketplace changes, it is imperative to the small and specialty contractor that they stay on the leading edge of this change so that they are poised to take advantage of the benefits, and avoid the pitfalls.

The small and specialty contractors are the ones who need to be the most pro-active going forward in order to assure success securing surety credit.


As sureties return to a more conservative and traditional underwriting mentality, their focus has turned to an intensive review and screening of key items that in the past have been downplayed, or even ignored. There are several items, but in an effort to streamline the information I’ll focus on what I believe is the triumvirate for successfully securing surety credit.

First: Prepared Presentation of Information

think-safety-hardhatThe best thing you can be in any situation is prepared. Walking out of your house during a blizzard in shorts and a tank top, while undeniably humorous, probably wouldn’t be the best of ideas and would more than likely have unwanted consequences. So why would you present yourself and your company to a surety without being 100% prepared to show them the best aspects of you and your company?

Every surety will ask for the same basic information so there is no short cut to avoiding this. It is how you prepare and present this requested information that will determine what the surety will, or will not, provide you in credit.

Second: Details, Details, Details

looking-at-blueprintsHow useful would blueprints be, if they had no measurements on the diagrams? The same holds true for the information that a surety will be looking for. If you leave out the details in the information, the surety can miss items or projects that could be used to push the envelope of your current program, or secure you your first surety program.

Make sure that when you are completing Work-in-Progress Schedules, Job Costing Schedules, or Questionnaires that you are putting in all of the information that the surety is looking for. This will help to avoid the surety coming back and asking questions on the blanks, and help you to streamline the process by providing all of the information needed the first time. Don’t be afraid that too much information will be overwhelming to a surety!

The same goes for financial information, both personally and corporately. When the surety asks for financial information, provide them with all of the details that they are asking for. This will help you to eliminate 2nd and 3rd requests for information, and allow you to focus on what’s most important: securing and executing construction contracts.

Third: Your Surety Agent

constuction-wokersI was having dinner with my wife at our favorite Asian restaurant one night. She looked at me with a perplexed look and said, “Why do they have hot dogs on the menu? Why would you go to an Asian restaurant for a hot dog?”

Your Surety Agent is your access to the bonding marketplace. A strong agent, or agency, can provide you with opportunities and access to surety markets that a smaller agency with minimal bonding experience cannot. Why would you go to an agent or agency that specializes in insurance products other than the product you are looking for?

Look for surety professionals that only work with bonds and bonding. Those are the people who will be able to provide you with not only access to the right surety market for your business, but also with sound advice to help you more easily secure, and keep, that market as the tides of good fortune flow in and out.

In Conclusion…

workers-constructionRemember, any opportunity that you and your company can secure that opens a new source of revenue is an opportunity that is worth pursuing. Do not let bad experiences in the past, or stories of others difficulties deter you from pursuing a surety relationship.

With the right guidance and direction, and with a pro-active approach to the needs of a surety, the process can be completed with minimal heartache and can lead to advantages over competition that choose not to bond!