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Surety Bond Blog
The surety underwriting procedure can often be viewed as being an agonizing ordeal for insurance agents as well as applicants needing to obtain bonds. Many times, the entire process can be very aggravating and stressful if an applicant is under a specific deadline or needs a bond very quickly. Here are some items that the surety company will most likely require. It is important to know what crucial information that a surety company or agency will require in order to be approved for any type of surety bond.
Like insurance, the surety industry is recurring. In the mid 90s, the surety industry was very pliable, and there was little underwriting being performed. A combination of the slowing economy and the poor underwriting practices from years prior caused the surety industry to suffer for the first five of five consecutive years in 2000. However, a booming economy led to more bond approvals and issuance, even for applicants that were less than qualified.
Fortunately, these losing years caused the market to fluctuate almost overnight underwriting standards were tightened and premiums increased substantially. Capacity quickly became an issue for contractors, particularly at both the small and large ends of the spectrum. Small, emerging contractors were finding it increasingly more difficult to obtain any bonding capacity and large contractors were also feeling the affects of the more stringent industry. The market has fluctuated over the past couple of years, and contract bonds and some commercial bonds can still be difficult to obtain. Some items that are crucial to obtaining prior to applying for a surety bond are:
A surety bond is a form of credit. The underwriter requiring financial information from an applicant is making a credit decision without ever meeting the contractor or applicant.. There may be a substantial amount of paperwork required; however, it may be the extra paperwork required that will get an applicant approved for a bond. An underwriter will most likely request the following:
Business financials It is beneficial and most often a requirement that these are prepared by a CPA. If it is a new company, submitting the most recent business financials will suffice.
Comments (5)
Category: Auto Dealer Bonds, Bid Bonds, Commercial Bonds, Contract Bonds, Contractor License Bonds, Court Bonds, General Bonding, Misc. Commerical Bonds, Money Transmitter Bonds, Mortgage Banker Bonds, Mortgage Broker Bonds, Performance Bonds, Subdivision Bonds, Telephone Solicitor Bonds, Title Agency Bonds, Wage & Welfare Bonds
Tags: application process, procedures, surety process, underwriting
I am in desperate need of someone to help me with a situation that is between an
auto dealership and a person who sells under the umbrella of a dealership at an
auction house here in FLA.. can someone help me please…
I have had my life threatened … by an auto dealership..here in st.pete fla..and a woman has
gone to the bonding company which has now put me out of a life time of work selling autos.
her claim that I owe her money.. she has gone falsely to the bonding company of the auto dealership that I worked under.. and the dealership has stated to me that the bond company is going t o pay off this womon who has made a false statement about the buying of an auto.
and the dealership owners..have threatened to kill me..
judiallen2007@yahoo.com
I am writing this letter for someone else… who is involved..trying to help them get help
Barbara,
It sounds like you should be contacting the police rather than posting comments on a blog.
As for the bond claim, you will want to provide proof that it is not a legitimate claim.
when someone needs help they call out for help..
and thanks for you response..
barbara
I have read most of your website because I found you so informative. My question is:
I have been told that it does not matter what brokerage I use for taking me to the market to underwrite me for bid and performance bonds because there are only about three underwriting firms for these types of bonds? Is this true? Thanks Patricia
Patricia,
It absolutely makes a difference where you obtain the bonds from. There are a lot more than 3 bonding companies licensed to write surety in CA.
The agency you choose is not only important for customer service, but also pairing you up with the right bonding company. Some agents are more knowledgeable than others and each usually has a different portfolio of markets they use.
Since you found our site so informative I am sure you would be willing to give us a try!
Start with us at: http://www.jwsuretybonds.com/surety-bonds/contrac…