Construction Bonds
What is a Surety Bond?
Surety is a form of financial credit known as a bond guarantee. A surety bond is a promise by a Surety Company to pay one party (the obligee) a certain amount if a second party (the principal) fails to meet some obligation, such as fulfilling the terms of a contract.
For example, a Bond company promises the Owner of a project that the contractor will complete the project based on the terms of the contract. If the contractor fails to complete the project the owner will be paid by the Bond company. The Bond company then has the right to recover it’s losses from the contractor.
The Benefits of Surety Bonds
Surety Bonds are cheaper than traditional Lines Of Credit from a bank. They also free up funds for the contractor to use elsewhere in his business.
First time applying for a Bond Facility? No problem!
Let St Andrews Insurance guide you through the process. Simply call our office and one of our brokers will assist you.
What if you are a new startup company?
If you are a new company, never had bonding and require Bonding call St Andrews we have the experience and resources to assist you in securing a Bonding Facility.
Bonding Services Offered by St. Andrews Insurance Brokers
- Agreements to Bond
- Bid Bonds
- Performance Bonds
- Labour & Material Payment Bonds
- Maintenance Bonds
- Prequalification Letters
Classes of Contractors We Support
- Developers
- General Contractors
- Manufacturers
- Road Contractors (Paving, Grading)
- Sewer and Watermain Contractors
- Site Services
- Subcontractors (ie. Mechanical, Electrical, Drywall, etc.)
Here Is What You Need In Order to Make an Application for a Bonding Facility:
- A completed Contractors Questionnaire form, which our Surety Specialist can walk you through if needed, but we designed the form to be easily understandable and completion should take about 20-30 minutes.
- Financial Statements -Financial statements are vital to any business that grants credit, and sureties are no exception. Depending on how long your firm has been in business, the surety will want to see fiscal year-end statements for the last two to three years.
- An organizational chart that shows your key employees and their responsibilities;
- Detailed resumes of yourself and your key people
- Evidence of a line of credit at your bank and a copy of your most recent Terms and Conditions letter if it is available.