In professional services, failing to meet basic standards like timeliness can directly impact your bottom line. While a surety agent should be a key partner in helping you increase bonding capacity and secure bonds for future growth, a slow response time can quickly turn into a liability. You might view a delay as merely lackluster service, but in the construction industry, it can have serious financial consequences.
Why Slow Responses Are Costly
In California, all publicly funded construction jobs require bid bonds. If you fail to include one, the project owner will deem your bid non-responsive. Gathering the necessary underwriting information can take time, so if you’re not made aware of what is needed with enough time, a slow agent may prevent you from obtaining the bond before the bid date, effectively costing you the job.
This urgency remains just as critical for performance or payment bonds. Project owners will only wait a limited time for these to be issued before moving on to the next contractor. Furthermore, failing to produce these bonds can lead to claims against your original bid bond, creating a significant and avoidable expense for your construction company.
Defining First-Class Service
Contractors should have a reasonable expectation of first-class service and efficiency. When evaluating your agent, consider these benchmarks for quality response times:
- Standard Turnaround: Routine bid, performance, or payment bond requests should typically be issued within 24 hours.
- Exceptions for Complexity: Larger bonds or those with unusual requirements; such as high liquidated damages or extended warranty periods, may require additional underwriting time.
- Proactive Communication: Even during complex requests, a high-quality agent provides expert guidance by keeping you informed of progress throughout the process.
To learn more about evaluating your current surety partnership, read our guide on 4 ways to determine if you are getting top-notch service from your surety agent.
What To Do if You Are Frustrated
If a lack of responsiveness is beginning to affect your construction company, consider these steps to address the situation:
- Submit Requests Early: Avoid waiting until your price estimates are finalized. You can use the project owner’s budget or the engineer’s estimate to get the process started. Note that surety companies generally require notification if your final bid exceeds the approved amount by more than 10%.
- Voice Your Concerns: Speak with your agent directly about their turnaround times. If they cannot commit to a standard of a couple of days or less, it may be time to seek a new partner.
- Assess Their Resources: Sometimes, an agent’s company is too small to handle volume efficiently, or they may be a general insurance agent who does not fully grasp the specific deadline pressures of the construction industry.
The CSBA Difference
At Commercial Surety Bond Agency (CSBA), we focus exclusively on surety bonds, meaning we understand the unique pressures California contractors face. We provide expert guidance to help you navigate challenges and develop a roadmap to grow your construction company.
Our team is committed to consistent, professional service, tracking every bond request to ensure timely delivery and responding to calls and emails the same day. We are proactive so you can focus on your projects rather than micromanaging your agent.
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We want to know more about how we can help your construction company get the right contractor bond for your next project.
