The Top 6 Questions You Need To Ask Your Surety Agency

Published on December 8, 2020

By Dan Huckabay, President
Commercial Surety Bond Agency

Over the last several years, innovations in the surety industry have made it convenient and fast for contractors to obtain a construction bond. There are numerous websites and surety bond providers peppering the digital landscape that claim they can offer fast service and the best prices. 

When there are so many providers to choose from, how can you tell which surety company has your best interests at heart? Who really provides the best service? Who has the bonding expertise and relationships to take your business to the next level?

The truth is that it can be difficult to know which surety agency is right for you. To help you navigate the surety bond landscape, we’ve created a list of the top 6 questions you need to be asking each surety provider, so that you can feel confident that you’re getting the right service for your business.

What percentage of your business is contractor surety bonds?

Consider a scenario where you might need heart surgery. It stands to reason you want an accomplished surgeon who only practices heart surgery. Surety bonds are quite similar–a lot of companies dabble in contractor bonds, but they don’t specialize in them. 

Many agencies are insurance generalists who offer a variety of different types of coverage. While this may seem convenient, these general agents often don’t have the skill set or relationships needed to execute on surety bonds. Insurance agents have a liability and legal focus, so that they can protect against loss. Surety works differently.

Surety bonds take a more financial angle, and involve understanding financial statements and the contractor’s operations and capabilities. A dedicated surety agency deeply examines these elements to work in the interest of the contractor and identify the most strategic bonding program.

Deep expertise in surety matters, because contractors rely on bonds to unlock future potential. Partnering with a surety agency that understands your finances and operations can position you to access increased bonding capacity, and ultimately win more projects.

How many surety companies do you represent?

Most general insurance agents work with 5-10 surety companies, because they don’t have enough volume of surety business to support working with many providers. A surety agency like CSBA only works in surety bonds, and we’ve developed long standing relationships with over 35 surety companies. 

This distinction is important, because a wider pool of providers means contractors have access to more opportunities to receive the right bond program. A smaller pool of options limits your bonding potential and what you can access. Furthermore, many surety companies only work with projects of a specific size or type. If your agent only has a handful of relationships with surety companies, they may be unable to find the right provider for your project.

By having close relationships with a multitude of companies, a surety agency gains a deep understanding of what each company will and won’t do, and the partnerships forged over time secures more opportunities for contractors. Simply put: a surety agency can leverage their network to find a solution to your need. 

Our team has exclusive relationships with more than 35 surety companies, and we receive preferred access because of our track record of success and trust. Our success is your success. 

Does your agency have internal underwriters on staff?

Most insurance agencies don’t have internal underwriters. Agents will gather a checklist of information from a contractor and pass it along to an underwriter, who will use the limited information they have to determine what’s best for the contractor. How can an underwriter who doesn’t understand your business or goals truly know what’s best for you? 

To put it plainly, many agents don’t have the skillset to understand contractor financial statements and best practices, or know how to advocate on behalf of their client.

Our internal underwriters help guide contractors to a position where they can maximize their bonding capacity. CSBA has 3 underwriters on staff, and all members of the CSBA team are trained on the underwriting process. At every level of our company, every step of the way, we identify opportunities, and advocate for your business. 

When it comes time to source the right contractor bond for your project, our trusted partners already know we’ve done due diligence, and that we’re presenting something that has merit.

How can you help my business and bonding capacity grow?

This question is hard to answer if you aren’t a specialist who can provide all of the value a dedicated surety agency like CSBA provides. Surety specialists use their experience working with contractors to develop best practices.

For example, we work with over 30 underground/pipeline contractors. We’ve learned their challenges and opportunities, and can share those insights to help more contractors in that specialty grow. We can advise on accounting systems, job tracking, and evaluate financials so that you can increase efficiency in your operation.

We can also help you avoid common risks and pitfalls. There are a lot of reasons contractors succeed and fail, and you need a team of specialists who have seen mistakes being made, to properly advise you on how to avoid them.

When it comes to increasing bonding capacity, it’s important to understand that growth doesn’t happen overnight. CSBA takes a proactive approach by working with business owners to map out the steps needed to achieve incremental goals. We reorient our clients to see into the future and identify where you want to go. Together, we help you plot out the steps to get there.

How do you decide which surety company to place me with?

Many insurance agents with only a handful of companies to choose from have limited choices, and in some cases agents may prefer to only work with certain surety companies, without any regard for whether or not it benefits your project.

You need an unbiased, objective advocate who positions you competitively. At CSBA, we get to know your business, how you run it, and what your goals and plans are so that we can identify the right surety companies who will fit what you need. We’re not about the commission. In fact, it’s the last thing on our mind.

When we turn to our network of providers, we take a holistic view of your profile and match that against over 35 surety company profiles. This matchmaking step is critical to properly align the sizes and types of projects you perform with a surety company that can meet your needs. We cast a wider net so that we have more opportunities to find the right match.

What kind of service can I expect?

We issue bid bonds within 24 hours for established customers. All bonding letters for pre qualification go out the same day. From the very beginning we take a proactive approach so that we can avoid last minute fire drills.

As a leader in the California surety bond industry, we’ve developed the infrastructure and relationships to provide expedite service for our clients. We can generally get a bond to California companies the next day, or within 48 hours. 

We strongly believe that personalized service is the most important factor in the entire bonding process. From the beginning, you’ll receive dedicated CSBA points of contact so that everyone is kept in the loop at all times. National companies tend to take a transactional “farm” approach, where leads are run through the process without ever getting to know your priorities.

For over 36 years, the CSBA team has led with a personalized approach to bonding, so that our contractor partners can feel secure that we have their best interest at heart every step of the way. Our specialty is surety bonds, but our goal is to help you grow your business.