When buying a Performance Bond you should always make sure your agent is the best agent for you. Not just any agent can give you the better rates or better service. That’s why you need to know if your agent has the experience you need and if they represent the quality carriers that you can trust.
Let’s start with five essential questions to ask a bond agent before buying your Performance Bond.
You’ll want to know if they place surety bonds every day or a couple times per month. If surety bonds are not their primary responsibility, they might lack the experience and understanding than an agent who regularly places surety bonds.
Additionally, experienced agents can guide you through the process without wasting time fishing for answers. They can get more done for you in less time than inexperienced agents.
While not every bond can be expedited, having an experienced agent is a great first step in getting your bond quickly.
You want someone who understands your company and the struggles you face.
If you’re a contractor, for example, do you really trust someone who has never stepped foot on a work site? Probably not.
Make sure they understand the details of your industry and your company because misunderstandings can lead to delays or unnecessary problems down the road.
Not all carriers are made equal. Make sure the agent represents carriers you can trust. If they only represent unknown carriers, make sure you do your research.
A great way to measure the reliability of an agent is to look at how many of the carriers that they represent are in the US Treasury’s list of top ten carriers. If they represent at least five, that’s a very positive sign.
Remember: the bond is a commitment to back you and your company—carriers need to know that you’re responsible, experienced and properly funded to handle the job and any unforeseen obstacles before they approve you for a bond.
So how you are represented by your surety agent is key in obtaining the bonding limits you really need.
Experienced agents can help you build a story that highlights your company’s positive history for the carriers. For example, an experienced agent might use so-called “Good Guy Letters” from past employers or developers to build a story of success.
The clearer your excellent business history, the more likely you are to get approved and obtain the bonding limits you really need.
While you might not need a bond for your maximum qualification, it’s good to know where you stand. You never know when your company will outgrow your current work?
You can’t trust just anyone when it comes to your Performance Bonds.
There are so many complex circumstances that are contingent on your company and your industry. You must ensure your agent has the experience in your field to ensure you get the best bond for your buck. So make sure you ask the essential questions before choosing an agent. You’ll be grateful you did, especially if you develop an unanticipated problem. A quality agent can become a valuable consultant as a problem solver if that unanticipated problem arises.
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