Contractor Frequently Asked Questions
1. What is a surety bond?
a. A surety bond is a three-party agreement between an obligee (owner), principal (contractor), and surety. Surety bonds guarantee that a contractor will perform obligations according to the contract. The surety can be held liable for the debt, default, or failure of the contractor when these obligations are not met.
2. Who do I go to when trying to obtain bonding?
a. When trying to obtain bonding, you should contact a reputable and professional surety bond producer who is a member of the National Association of Surety Bond Producers. Surety bond producers specialize in providing long-term surety support and resources.
3. What are the documents I may be asked to provide during the bonding process?
a. Contractor questionnaire (producer will provide)
b. 3 fiscal-year-end financial statements
c. Most recent interim financial statements
d. Personal financial statement for all owners
e. Bank reference letter (including average balances and lines of credit)
f. Resumes of owners and key persons
g. Current work on hand
4. What does a surety specific agent do for me?
a. Your surety agent will provide invaluable business advice as it relates to surety credit. Your Parrot Surety Specialist will possess financial analysis skills, provide timely responses, and guide you through the bonding process. This will include asking questions to better understand your business model, business plan, and business goals. You and your Parrot Surety Specialist will determine what bond or bond program needs are sufficient for today and what size and scope of bonds will be needed in the future. With this information, your agent will have a good idea of which surety company would be the best fit for your business to maximize your surety credit and drive the best surety program terms for your company.
Have more questions?
To establish a connection with a Parrot Surety Producer and obtain recommendations to improve or optimize your access to surety credit, give us a squawk at 615-205-5080 or info@ParrotSuretyServices.com
Our expertise comes at no extra cost to you. Don't hesitate to reach out!