Surety Bond Education

In my past as a construction surety bond underwriter and manager I have worked with some great bond agents.  What are some differentiating traits?  See the list below.  Remember, the goal of any bond agent should be to become a business consultant, someone you call needing solutions, referrals, or even just to vent.  Your agent can only take on this role if you allow them to.  It’s about more than getting the next bond, use their knowledge to your advantage! Work with a Specialist The surety industry is a highly specialized and nuanced niche business. Choose a agent who is […]

The goal of the Small Business Administration’s (SBA’s) Surety Bond Guarantee Program is to allow small businesses to obtain bid bond and payment and performance bonds it needs to further its business enterprise. For various reasons such as weak credit history or low working capital, these small businesses may not be able to obtain the bonding they need in the standard surety marketplace. The SBA supports attaining this goal by providing financial backing, the bond guarantee, to participating surety companies.  In other words, the SBA does not work directly with businesses in this program but through a surety company. How […]

A Subdivision Bond is a type of contract surety bond.  A Subdivision bond guarantees public improvements will be completed pursuant to the development agreement between a governing municipality and a developer. For example, if a developer wants to take a piece of raw land and break it up into residential lots for homes he or she would engage in an approval process with the governing city of county.   A civil engineer would draw up a site plan including public improvements.  Examples of public improvements are: Storm or sanitary sewer Water main Streets Curb & gutter Fire protection such as […]

A Maintenance Bond is a type of surety bond guaranteeing good condition of constructed improvements for a period of time after acceptance of the work. When Are Maintenance Bonds Required? We commonly see Maintenance Bonds required in conjunction with commercial development projects. As part of the scope of the project infrastructure improvements such as water/waste water service, curb inlets and streets are constructed. These improvements are turned over to the municipality after acceptance so they require a Maintenance or Warranty period to make sure those assets don’t deteriorate due to poor workmanship or poor materials.  A standard Maintenance period is […]

Payment and Performance Bond Information Information Underwriting Indemnity Agreement Qualifying for a Payment and Performance Bond Some of the surety companies we represent offer an expedited underwriting process based on a completed application and personal credit scores. A minimum credit score of 600-700 will be needed, varying by company, and business credit will also be reviewed. The stronger your score, the easier it will be to qualify for a payment and performance bond. The application often includes work references for large or previously bonded projects. Rates and Forms Premium rate on smaller bonds in the expedited program will vary by […]

What is a Right of Way or “ROW” anyway?  The most basic definition of a right of way is a legal right to pass through property belonging to another. A public Right Of Way is a type of easement granted over land for transportation purposes such as highway, road, footpath, rail transport, canal or even utility lines.  We will focus on the City of Austin Right of Way Bonds here. Right Of Way Permits Business activities like a sidewalk cafe or locating a dumpster on public property will require a permit from the local municipality such as the City of […]