Simplifying Smaller Bid Efficiency and Fee Bonds for Brokers and Contractors

This submit is a part of a collection sponsored by Previous Republic Surety.

“We’ve focused tight turnaround occasions from submission to approval utilizing Previous Republic Surety’s (ORS) FastBond course of — the sooner, the higher,” says Todd Taylor, CPCU, AFSB.

As an ORS Bond Supervisor, Taylor has seen the favorable affect of FastBond, which has been obtainable for greater than 10 years. “We’ve managed to simplifythe bonding course of for brokers by providing limits as much as $1 million primarily based on credit score solely,” he says. “And since there’s no want for extra monetary data and no CPA required, that saves super time and problem. Throughout the Quick Bond program, Previous Republic Surety will think about non-residential completion bonds as much as $250,000 in bond penalty on credit-based underwriting. Greater limits might be thought-about with further underwriting data.”

What if a consumer does require extra? Taylor explains that they will nonetheless use FastBond to safe as much as $2 million single or combination by including present company and private monetary statements to their software — nonetheless no CPA involvement obligatory.

Taylor notes a latest uptick in FastBond exercise as properly. “We’ve a historical past of writing accounts utilizing widespread sense underwriting, and Previous Republic Surety is pleased with our partnership with brokers who write accounts which may be smaller or just have few or very rare bond wants. These are the sorts of accounts which are an actual plus for thus many brokers. Though they could not qualify for our contract aspect, they signify an actual mainstay of the development trade.”

Protecting brokers aggressive

To remain forward of the curve and preserve a management place in these smaller account markets, Previous Republic Surety requests agent suggestions and displays trade circumstances. “As in different sectors, development prices have risen throughout the board, making the identical threat are available in at a a lot increased worth than it did just some years in the past,” Taylor says. “We’ve continued to regulate our limits as wanted to maintain tempo with these adjustments, which is why we not too long ago elevated limits from $750,000 to $1 million primarily based on credit score. The FastBond software is so simple as earlier than, however increased limits maintain our brokers aggressive, and so they can qualify bigger accounts with much less want for underwriting. Better of all, even at these increased limits, the short turnaround remains to be potential, which might be essential for successful a bid.”

As Taylor notes, contractors usually postpone tackling bond points till the top of a bid course of, and it’s commonplace for them to attend in an agent’s workplace for bond approvals. “Bid time stress might be intense,” he says. “Our fast turnaround alleviates a few of this stress.”

Whereas many brokers are already comfy with the FastBond software course of, the ORS group is able to bounce in and supply steering for any brokers who’re simply getting began in bonds or who may need assistance with the primary few functions. “We will pace up the educational curve and double-check their work till they’re comfy doing an software on their very own,” Taylor says, “However as a result of the shape is so simple and the bond is primarily credit-based or solely requires current monetary statements for increased quantities, most brokers grow to be adept fairly shortly.” He provides that Previous Republic Surety also can present a bond-ability or pre-qualification letter if that’s a requirement earlier than any formal bonding. “We’re at all times glad to confirm {that a} subcontractor can qualify for a bond if that’s all they want with the intention to submit a bid,” he says.

FastBond can be a useful stepping-stone for brokers who wish to assist their purchasers transition into bigger initiatives. “Few purchasers are in a position to bounce to a typical bond program in a single day, and a few simply don’t wish to make the extra required investments, like CPA involvement,” Taylor says. “With FastBond, the upper limits assist brokers maintain extra of their rising accounts till they’re able to graduate to our contract aspect.”

FastBond benefits

Whereas Taylor considers the upper limits, fast turnaround and simple software course of amongst FastBond’s major advantages, he additionally highlights their bond availability in all 50 states and their consideration of all development trades. “This can be a resolution that’s ideally suited for shorter period initiatives in that candy spot of $1 million to $2 million, however we have now loads of flexibility to debate variations,” he says. “Even when a job is projected to be barely increased, we wish brokers to name us; we’re at all times keen to debate the underwriting specifics and dig into the main points of a challenge to succeed in an approval. Previous Republic Surety has at all times primarily based our bond approvals on extra than simply the spreadsheet numbers.”

Taylor provides that the corporate will proceed to guage and alter FastBond as wanted. One latest enchancment is the addition of safe DocuSign digital signatures for functions. Different workflow options are in fixed evaluate.

“Providing a extra streamlined bonding course of for smaller exposures is likely one of the greatest methods to increase alternatives for our brokers,” he says. “And Previous Republic has actually supported our efforts to enhance small account servicing. In any case, extra bonds imply extra progress, and simply because a bond could also be thought-about small by trade requirements or a consumer has an rare want, they’re nonetheless a necessity. We’re right here to make getting them as straightforward as potential for our brokers.”

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