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Surety Bonding

Surety Bonding

Commonly Requested Surety Forms:

Construction contractors have very distinct and specialized bonding needs. They require advisors with specific experience – who really understand their business and its unique aspects – and who can negotiate the intricacies involved in presenting cases to the bonding company. Your Surety Bond insurance broker serves as an objective, external resource for evaluating your financial, managerial and operational capabilities and, when necessary, will suggest improvements to help you meet a surety company’s underwriting requirements. Whether it’s obtaining your first bond, undertaking the largest project in your history, or navigating through an ownership transition or ESOP transaction, we will work with you to secure the surety program you need.

A Well-Earned Reputation

Our firm represents all of the leading contract surety companies in the country. We enjoy an extremely close relationship with each of them that is built on our reputation of trust and integrity. Our sixty plus years of experience in the industry only aids the relationship between the companies and our clients. We have also nurtured personal relationships at the Home Office level of each of our surety company partners, which gives our customers access to the ultimate decision makers. As a member of the National Association of Surety Bond Producers (NASBP), Insurance Associates is dedicated to the highest levels of professionalism and expertise in surety.

Types of Bonds Provided
Other Surety-Related Services

Bid Bonds

A bid bond guarantees to owners that the contractor bidding for the contract will, if the bid is accepted, enter into a contract and provide the required performance and payment bonds for the actual project.

Performance and Payment Bonds

A Performance Bond guarantees that a contractor will perform its obligations assumed in the contract, in accordance with the plans and specifications, for an agreed sum of money to be paid to the contractor by the owner, whether public or private. This bond follows in sequence after a bid bond has been posted and the bid has been awarded. A Performance Bond is normally written in conjunction with a Payment Bond.

Subdivision Bonds

A subdivision bond guarantees to a County or municipality that the developer or contractor will provide and install all required public improvements outlined in the filed site plan.

Commercial Surety Programs

Commercial surety bonds are bonds that do not fall under the “non-contract” categories. Some examples of commercial surety bonds are license and permit bonds, financial guarantee bonds, and compliance bonds.Insurance Associates provides resources to clients to support these types of bonds. We conduct financial analysis for clients and assist clients to understand the laws and regulations that govern these types of bonds. These can vary by jurisdiction.

Environmental Bonds

Environmental bonds are also known as hazardous waste bonds. These types of bonds apply to projects that involve the abatement, installation, or altering hazardous materials such as asbestos, mold, and lead.Insurance Associates will evaluate the particular exposure and advise contractors on the best practices to mitigate risk. We will find the appropriate surety company for each specific project’s needs and risks.

License and Permit Bonds

Most municipalities and states require license bonds of many types of business in order to obtain permits or licenses. These bonds guarantee that the license holder will conduct its business in accordance with all of the rules and requirements of the license.

Court Bonds

Court bonds are bonds for plaintiffs and defendants that guarantee an obligation to the legal jurisdiction.Common types of court bonds are Probate, Fiduciary, Personal Representative, and Release of Lien bonds

Small Business Administration (SBA)

The Small Business Administration financially guarantees surety bonds in partnership with surety companies who may view small or new business as financially risky. Surety companies may view these businesses as risky due to a lack of experience in their industry or due to limited stable financial evidence. This type of guarantee can assist new or financially unstable contractors obtain bonds that they may not otherwise be able to acquire.The SBA is willing to guarantee bonds up to $6.5 million (larger bonds can be considered is a federal contracting officer deems necessary) and will reimburse a surety company between 70%-90% of the bond amount in the event that the contractor defaults on the bond.Applying for the SBA program can be a lengthy and involved process. Insurance Associate will assist contractors step by step through this process.

  • Reference Letters
  • Pre-Qualification Letters
  • Letters of Intent
  • Consents of Surety
Surety Services offered:
  • Top-Notch, Quality ProcessingOne of the most important services that we provide to our customers on an ongoing basis is handling the numerous day-to-day requests for bid bonds, reference letters, and performance and payment bonds. We understand how time sensitive many of these requests can be, which is why we surround you with full time, highly competent bond specialists in each office. We understand how errors on bonds can lead to a contractor’s bid being rejected, which is why our quality control standards require that all bid bonds be reviewed by two separate people prior to its release to the client.
  • Bond Form ReviewWe will provide a prompt review of an owner’s contractually required bond form, be it private or public owners, to assure that the terms and conditions contained in the bond form is within industry standards and norms. We can recommend and provide substitute bond forms when necessary. We will also review bonds obtained from your subcontractors to ensure they are executed accurately by a licensed, Treasury listed surety.
  • Owner Pre-qualificationWith the extensive financial and underwriting background of the Insurance Associates staff, we are well adapted at conducting research and offering opinions on the credit worthiness of potential owners and subcontractors. We provide advice from our working knowledge of the construction and surety industries as to the behavior history and reputation of owners, and their respective bond forms and contract documents, which allows our customers to adjust their risk assessment.
  • Confirmation of FinancingOn privately financed construction projects, Insurance Associates can conduct due diligence on the availability of 100% construction financing to assure that funds are available to pay you, as well as your suppliers and subcontractors. Confirmation of financing can be presented to the owner as a bond underwriting condition.
  • Claim MonitoringWe maintain a close monitoring system with the Claim and Underwriting Departments of our surety partners, to assure that any and all claims received against your Performance and Payment bonds are communicated to you, investigated, and defended in a timely and proper fashion.

Click here to visit our online glossary for a list of related terms.

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