Establishing an In-House Bonding Policy
In some recent blogs, we’ve covered what surety bonds are and why you need them as a contractor. In continuing that trend, here’s some tips on what you need to do internally in your office to make sure you obtain bonds when necessary. Use this list as a guide and add your own parameters for securing bonds.
- Set a limit at which bonds must be required. This may be a dollar amount or a percentage of a contract (ex.: all contracts over $25,000 or all subcontracts for 20% or more of the overall job).
- Include the following details in your bonding policy:
- Type and complexity of the job
- Duration of the contract
- Bid spread
- Subcontractor size and reputation
- Government regulation requirements
- Subcontractor’s experience with the type of project on the table
- Subcontractor’s role in the contract
- Once your policy has been established, notify all subcontractors, the surety bond producer and the surety underwriter.
Still have questions on surety bonds? Contact Consolidated Insurance + Risk Management today!