Simplifying Smaller Bid Efficiency and Cost Bonds for Brokers and Contractors

This put up is a part of a sequence 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 accessible 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 info and no CPA required, that saves super time and trouble. Throughout the Quick Bond program, Previous Republic Surety will take into account non-residential completion bonds as much as $250,000 in bond penalty on credit-based underwriting. Greater limits will be thought of with further underwriting info.”

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

Taylor notes a current uptick in FastBond exercise as properly. “We have now a historical past of writing accounts utilizing frequent sense underwriting, and Previous Republic Surety is happy with our partnership with brokers who write accounts that could be smaller or just have few or very rare bond wants. These are the sorts of accounts which might be an actual plus for thus many brokers. Though they could not qualify for our contract facet, they characterize an actual mainstay of the development trade.”

Retaining 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 danger are available in at a a lot increased worth than it did only a few 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 lately 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 hold 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 continues to be potential, which will be essential for successful a bid.”

As Taylor notes, contractors usually postpone tackling bond points till the tip of a bid course of, and it’s common for them to attend in an agent’s workplace for bond approvals. “Bid time strain will 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 staff is able to leap in and supply steerage for any brokers who’re simply getting began in bonds or who would possibly need assistance with the primary few purposes. “We are able to velocity up the training 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 present monetary statements for increased quantities, most brokers develop into adept fairly rapidly.” He provides that Previous Republic Surety may also present a bond-ability or pre-qualification letter if that’s a requirement earlier than any formal bonding. “We’re all the time comfortable to confirm {that a} subcontractor can qualify for a bond if that’s all they want with a purpose to submit a bid,” he says.

FastBond will also be a useful stepping-stone for brokers who wish to assist their purchasers transition into bigger initiatives. “Few purchasers are in a position to leap to an ordinary 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 hold extra of their rising accounts till they’re able to graduate to our contract facet.”

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. “It is a answer that’s ultimate 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 all the time keen to debate the underwriting specifics and dig into the small print of a challenge to succeed in an approval. Previous Republic Surety has all the time primarily based our bond approvals on extra than simply the spreadsheet numbers.”

Taylor provides that the corporate will proceed to judge and regulate FastBond as wanted. One current enchancment is the addition of safe DocuSign digital signatures for purposes. Different workflow options are in fixed evaluation.

“Providing a extra streamlined bonding course of for smaller exposures is likely one of the finest 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 development, and simply because a bond could also be thought of small by trade requirements or a shopper 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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