Want Your Surety Bond Fast? Be Prepared
While some applicants have time to spare, many companies in need of a surety bond want their bond expedited. One surefire way to get the application process moving is to be prepared. Knowing what information your surety agent will need helps you gather your documents ahead of time so we can get you your surety bond ASAP.
When you’re gathering your documents for your surety bond, remember the big picture: you are trying to tell a story about yourself and your company to prove that you’re responsible and experienced enough to complete the job for which you need a bond. The bond is a commitment to back you and your company; carriers will not give them out to just anyone.
So What Will You Need When You’re Applying for a Surety Bond?
1. Financial Statements
You will need both personal and corporate financial statements. Carriers want to make sure you’re capable of meeting the demands of the job.
Which financial statements you’ll need depends on the approximate size of your company. For companies under 20 million in sales, expect to show the following financial statements:
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The corporate financial statements for the last calendar year and interim compilation for this year.
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Personal financial statements of the majority shareholders.
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Copies of the most recent corporate and personal tax returns.
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A bank reference letter and recent bank statements.
For companies with 20 million or more in sales, the last calendar year statement must be reviewed or audited. In companies this size, you probably won’t need personal financial statements, copies of tax returns, bank reference letters or bank statements.
2. Contractor’s Questionnaire
This document will be provided by your bond agent. It will require information about your company like your Tax ID, state of incorporation and the number of employees in your company.
These questionnaires are not set in stone: different agents may ask different questions. If you have your personal and corporate details in order, you shouldn’t have any problems with this document.
3. References
No matter how great you are, a bond company can’t just take your word for it. They will likely want references from suppliers and from previous jobs to make sure you’re as great as you sound.
Essentially, you want references that will tell the company that you pay your bills and finish your jobs. Overall, they want to make sure you’re responsible and reliable.
4. Resumes for Your Key Personnel
Many agents will require additional information about your key personnel to ensure they have the clearest possible picture of your company when they submit your application to the carrier.
Again—you want to show the carriers that you’re equipped to handle the job for which you need a bond.
5. Work in Progress Form
A Work in Progress form (WIP) lets carriers see your timeline for work: what you’ve completed recently and what other work you have coming in the near future. It should also include any other surety bonds that are outstanding.
The WIP is required for the current and past year. Make sure you use the WIP provided by your agent so you don’t miss any required information.
6. Certificate of Insurance
Bond agents will want to confirm that the job is insured properly. Otherwise, they would be taking on an even larger risk.
Conclusion
Having your documents in order will give you an enormous advantage when applying for surety bonds. If you need your bond expedited, organization is essential.
While you’re gathering your documents, make sure they’re telling carriers your story of success.
If you don’t show them how reliable and experienced your company is, why would they back you?
