develop own website

APPLICATION

YOUR BUSINESS REVIEW

An application form and full details of your business (company) are required. This may appear time consuming but the insurer needs to know a lot about the Applicant - as you would if someone asked you to guarantee them. The Applicant needs a sound financial and resource basis together with an appropriate business track record, expertise, and reputation.

1. Forms To Be Completed


Corporate Questionnaire (Form A) - gives us the much needed background on your company


Specific Bond Application (Form B) - covers the particulars of your specific project application.

Statement of Financial Position - provides financial information for potential guarantors.

Checklist - helps you make sure you have covered all the requirements for your surety bond application to proceed.

Note the additional attachments required to accompany the abovementioned forms are listed in the section 'The Basics of a Contract Surety Bond Submission' below.

You can find the abovementioned forms attached below. Upon completion, you can either email or post the forms to us to commence the underwriting review. 

2. Commence Applications Well Before Critical Dates

Contractors need to get their bonding requirements in order early. There is not much point in asking for one off bonds the day before the first progress payment is due! BGA recommends that Applicants have us arrange a bond well in advance so that when a bond is required it can be issued with a minimum of delay.

3. Provide Complete Information


The quality of information and the manner in which it is presented will dramatically influence whether or not a surety credit (bond) is granted and to what dollar amount. With proper preparation and guidance, Applicants can do a great deal to maximize the prospects of their surety bond credit application. BGA will provide guidance where required.


Once all the information has been submitted and the bond issued, all that is required is updating the information from time to time.
To start, the Applicant needs to assemble the following information:

 a) Reputation and experience - Any documentation, including industry and credit referees, quality assurance and past projects, to establish reputation and/or experience will enhance the presentation. A picture is worth a thousand words, and photographs or brochures documenting where you have been and what you have done are a significant enhancement.

b) Completed and current contracts - Information containing a portfolio of your past completed and current projects speak volumes of your capabilities and experience. This coupled with clients testimonies (if available) helps the underwriter get a better understanding of your company, your abilities and competencies in completing a project on a timely basis and in accordance to the contract agreement.

c) Applicant's Financials - Not enough can be said about the importance of the financial information provided. It is critical and must be prepared in the correct form by a chartered accountant (or equivalent) with a sound reputation within the industry. Ideally the past three year-end financial statements should be supplied including a profit and loss statement, balance sheet and cashflow statement (if available).

A continuing flow of financial reports during the course of the year, ideally quarterly, is usually asked for and should be planned for in advance. Good financial progress and reporting will also enhance the Applicants ability to obtain additional bonds.
  
d) Personal Financial Statements and Guarantees - there is also the requirement of personal financial statements of the individual owner(s). Additional assets outside the Applicant's business entity (whether a corporation, partnership, or sole proprietorship) will be given due consideration, as the personal guarantees of all owners will be required to guarantee the obligations of the contracting company. 

e) Business Plan - In addition to reputation, experience, and adequate capitalisation, the Applicant must have a sound and realistic business plan and vision for the business. This may take the form of a special relationship with certain project owners, proven abilities in value engineering, or expertise in certain construction methods. The bond provider, in its subjective evaluation, will be trying to understand your business strategy, i.e., your attitude toward bidding and obtaining work. It will be looking for a sensible, conservative point of view toward taking risks and evidence of your contracting history. This plan should help the bond provider follow where the Applicant wants to go and how it proposes to get there.

The Basics Of A Contract Surety Bond Application


• Contractor's questionnaire, including credit and performance references


• Audited or externally prepared financial accounts and reports for 3 years

• Up to date management accounts

• Bank reference letter (setting out current bank facilities including bonding)

• Work-in-progress spreadsheet information

• Personal financial statements on owners / shareholders and directors that will act as a Guarantor

• Bond format. This is usually specified by the project owner (Beneficiary)

Download Documents

 We have supplied these documents in PDF format