A General Guide to Surety Bonds

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Sureties are a specialized division within the insurance industry that work with Contractors to underwrite and provide bonds. When working on a construction project, you may be asked to provide a bond. A bond is a three party agreement between the Surety, the project Owner, and the contractor on the project.

There are several different types of bonds, but each is written to guarantee certain contractual obligations and to guarantee the contractor’s duties to the Owner-provided that the Owner fulfills its obligation to the contractor. Below is a list of the most frequent types of bonds:

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Topics: Surety

Not All Surety Bond Programs Are Created Equal

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Surety bond programs are not a one-size-fits-all for construction companies. This is the reason why we see hundreds of surety companies in the marketplace nationwide, each having their own carved-out niche.

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Topics: Surety

What is Subcontractor Default Insurance (SDI)?

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Subcontractor Default Insurance (SDI) provides insurance for General Contractors against default from a subcontractor. The coverage is an alternative to a surety bond and is purchased from an insurance carrier in order to protect the General Contractor from the subcontractors they hire. To get a stronger understanding of Subcontractor Default Insurance, there are two types of default that you should know about. 

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Topics: Surety

How to Increase Bonding Capacity For Contractors

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Often for Contractors, the time comes when you look at the upcoming bids list and wonder how you can qualify for the larger jobs that your competitors routinely go after. Bidding on larger jobs does require some planning. Here are some suggestions on how to increase your bonding capacity while still growing your company’s profitability.

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Topics: Surety

How Succession Plans Impact Your Surety Program & Credit Facilities

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You have spent years building your company to the success it has now, but what happens when you want to retire? Figuring out how to carry on your legacy and transition ownership can be a challenge! This is not a decision you can rush into, and it’s important to understand the different succession options you have.

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Topics: Surety

6 Ways Your Surety Broker Should be Focusing on You!

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As a business owner, your company’s customer service is one of the keys to your success. The service that you should expect from your Surety Broker should be no different. Below are some of the best practices that your broker should be following.

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Topics: Surety Bonding, Surety, Surety Broker

Top 5 Ways a Surety Broker Impacts Your Company

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Maintaining a solid surety program can be vital to your company’s success. It is important that your Surety Broker understands your business, so they can advise you on how to maximize your bond program and the overall profitability of your company. Here are 5 ways your Broker can truly impact your company.

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Topics: Surety Bonding, Surety, Surety Broker

Termination for Cause vs. Convenience

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There may come a time during the course of a construction project when a contractor’s relationship is terminated. There are a number reasons this may occur such as:

  • The contractor’s financial trouble
  • Disputes regarding the quality of the work
  • Failing to adhere to the contract documents, or project schedule
  • Failing to pay trade contractors and material suppliers    

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Topics: Construction Contract, Surety

How Surety Bonds Work in Default

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A surety bond can cover both an owner and a contractor when there are any issues interfering with the completion of a project. When a trade contractor first gets licensed, they are required to obtain a contractor bond that helps protect customers from unfinished work.

Default is an unfortunate aspect of the construction industry, and it is important to understand why default occurs and what happens when it does.

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Topics: Surety Bonding, Surety, Default

3 Ways Surety Bond Brokers Help Your Business Thrive

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As a Contractor, you are working hard to secure new jobs, lower material costs, and retain good employees. Did you know that your Surety Bond Broker is there to help you build and maintain a profitable construction company? Working closely with your Surety Broker will ultimately result in a stronger bond program for you and help keep your company safe from construction risks. Keep reading to find out how!

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Topics: Surety Bonding, Surety

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