Contract Surety
Contract Surety Bonds for Construction Obligations
Contract surety supports obligations created by construction and related agreements. AGS Surety works with general contractors, specialty contractors, subcontractors and suppliers to develop submissions that reflect their financial position, experience and pipeline.
Bond Types
Common contract bond forms
- Bid bond
- Supports a contractor's bid and the commitment to enter the contract and furnish required final bonds if awarded.
- Performance bond
- Guarantees performance of the contract in accordance with its terms and conditions.
- Payment bond
- Supports payment obligations to subcontractors, laborers and suppliers as defined by the bond form.
- Maintenance / warranty bond
- Covers defined post-completion obligations for a specified period.
- Completion bond
- Used where a project's completion must be assured for a lender, owner or other stakeholder.
- Subdivision / site improvement bond
- Guarantees improvements required by a municipality or public authority.
- Supply bond
- Supports the delivery of materials or equipment under a contract.
Underwriting
What sureties evaluate
Contract surety underwriting is a credit evaluation. A complete, well-organized submission generally produces better terms and faster answers.
- Financial statements and the quality of financial reporting
- Working capital, net worth and liquidity
- Work-in-progress and backlog reporting
- Experience with similar scope, size and delivery method
- Ownership, management continuity and succession
- Banking relationships and available credit
- Character, claims history and references
- Indemnity and, where applicable, collateral
Capacity
Single-job and aggregate capacity
Sureties generally establish a single-job limit and an aggregate program limit. Both can grow as financial reporting, backlog management and completed-project history strengthen. AGS Surety works with clients to build toward the capacity their pipeline requires.
Bidding soon? Start the review now.
Bid deadlines rarely allow time to assemble a submission from scratch. Send the bid specification and current financial reporting and we will begin the review.