Surety Bond Education

Surety Bond Education

What Do You Look For In A Surety Bond Agent?

What Do You Look For In A Surety Bond Agent?

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 […]
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Interview with Eric Schmalz – We Made The Construction News!

Re-posted from the June issue of Austin Construction News: As many celebrate their fathers this June, Eric Schmalz reflects on the man who was the greatest influence on his life and surety career.          “My dad was a Marine officer in Vietnam and then he transitioned those leadership skills into success as a surety company executive,” Schmalz says. “Having my father’s example laid out in front of me, I knew I wanted to be in business. I learned a lot from him about being a leader and working hard.”          Honolulu-born and Philadelphia-raised, Schmalz earned an Economics degree from the […]
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What Is The SBA Surety Bond Guarantee Program?

What Is The SBA Surety Bond Guarantee Program?

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 […]
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What Is A Subdivision Bond?

What Is A Subdivision Bond?

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 […]
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Maintenance Bond Versus Performance Bond

Maintenance Bond Versus Performance Bond

What is the difference between a Maintenance Bond and a Performance Bond? A Maintenance Surety Bond provides protection against defects on construction improvements already put in place.  This work has been accepted by the owner as fully completed by required standards and specifications.  And the Maintenance Bond will provide financial guarantee should any defects arise from materials or workmanship.  From a risk standpoint: The primary concern of the work actually getting done has been alleviated.  And the maintenance period could be interpreted as less risky since the work was inspected and accepted by the owner’s engineer. A Maintenance Bond carries […]
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What Is A Maintenance Bond?

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 […]
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