To maintain and increase surety capacity, it is important for a contractor to develop and maintain an ongoing relationship with the underwriter and producer. Developing a relationship requires commitment, trust, and above all communication. Maintaining the relationship through open communication and timely reporting on the company's financial condition and job status reports builds trust with the surety. Maturing into a growing partnership requires teamwork and an organized effort among the contractor, the surety underwriter, and the surety bond producer. There may be difficult times, and the surety may not always be willing to extend the level of surety the contractor would like, but maintaining a relationship with the surety company builds trust and increases the surety's commitment to the contractor over time.

Benefits of Bonding

The surety industry is an integral part of the construction business. A good surety underwriter and surety bond producer can be two of a contractor's greatest assets. The producer and underwriter are professionals who possess or have access to a wide variety of resources to assist contractors. They do all they can to see that a contractor remains viable. The surety team interacts with a cross section of the construction industry and can assist the contractor with:

• Professional references - The surety team knows accountants, bankers, and lawyers who understand the construction business.
• Corporate experience - Producers and surety company personnel can share their experience on issues facing a contractor.
• Funding verification - This service becomes very important if a contractor is involved in private construction. Many contractors have faced bankruptcy because they did not ask the source of funding on private projects. The surety will insist on knowing the source and adequacy of funds before it will commit to bonding a project.
• Contract reviews - Many sureties perform contract reviews to identify contract terms, general condition requirements, or anomalies in the specifications or bond forms that may be onerous, unacceptable, or add undue risk to the project.
• Continuity plans - Sureties can assist the contractor with a continuity plan to protect the contractor's family, estate, partners, creditors, employees, and assets.

Next: Conclusion