Bonding Success Stories Expanded Surety & Profitability Market Availability Pays Off Creative Surety Solution Delivers Surety Capacity Negotiation

Expanded Surety & Profitability In late 2007, a specialty trade contractor came to Business Insurance Associates, Inc. with a surety program in place that was extending surety capacity in the range of $ 200,000 - $ 250,000 on single projects and $ 750,000 aggregate, but required the contractor to post collateral in the form of an irrevocable letter of credit (ILOC) to support the aggregate program. In reviewing the business operations and financial systems and controls, it became apparent that (1) this contractor needed more surety capacity to support their operational goals and objectives, and (2) that there were several deficiencies that needed to be corrected. Business Insurance Associates, Inc. discussed the financial management of the corporation with the owner, put together a strategy to build liquidity and recommended a greater level of involvement from a CPA familiar with construction accounting. The following year, after implementing all of the recommendations, the contract carried surety capacity of $ 1,000,000 single limits and $ 2,000,000 aggregate, affording them the opportunity to bid a greater work program for that year. Within two years, total revenue had grown by 40% and owner profits increased ten fold.