The Most Important Element in Surety Bonding Is…

  • Working Capital?
  • Net Worth?
  • Profitability?
  • Longevity?

What is the SINGLE most important element that underwriters consider when reviewing a bond account?
What is the ONE most relevant factor applicants must have in order to qualify for surety bonds?

Each of the financial factors is important. It’s like how much gas you have in the tank. Low or no NQ or NW means you may not go far.

Profitability is how well the engine is running. Hear a funny noise? That could be a bad sign. These are all important, but they are not the ONE most critical factor.

The Answer:

If you were the underwriter, if you were betting your own money, would you rather back an applicant with lots of dough or one that was absolutely trustworthy? Think of it this way:

Billy shows a strong financial position, but has a history of tax liens.
Suzie has limited financial recourses, but her credit score is high.

Who do you go with? I would lean toward Suzie. Billy has the big bucks, but how do we know he’ll do the right thing with his $. Will he pay his invoices properly and avoid bond claims? Stay out of trouble with the tax collector? Do the right thing by us? Maybe he got his money by dealing dirty…

Suzie on the other hand can be trusted. She may qualify for assistance or support. Given the chance, this honorable person may succeed.

So, you could argue that the one most important element is the CREDIT REPORT. It is objective, current, third-party info that reveals the applicants character. It helps the underwriter identify trustworthy applicants, people who honor their obligations.

Without that, you have nothing.

FIA Surety is a carrier that provides A rated, T-listed bonds in all states!

Need a Contract, Site or Subdivision Bond? We’re waiting to serve you. Call 856-304-7348

Surety Bonds: “How much are pork chops?”

“Our pork chops are on sale today, only $.89 a pound!
But we’re all out of them…”

It’s a fact, when you’re out of capacity, whether it’s pork chops, gasoline or surety bonds, you ain’t goin’ nowhere…!

In todays highly active bidding market contractors need enough capacity to pursue multiple contracts while they wait for bid results and contract awards. That’s where we come in!

FIA surety is a carrier that has the attitude and flexibility to provide what’s needed. And we’re small enough for you to talk directly with the decision makers. That’s been a key to our success all these 40 plus years.

We provide A rated, T-listed bonds in all states.

Call us for Site, Subdivision and Contract Surety Bonds: 856-304-7348
FIA Surety: We Get It Done!

FIA Surety / First Indemnity of America Insurance Company, Morris Plains, NJ

Call us for Site, Subdivision and Contract Surety Bonds: 856-304-7348

Meet the “Frankenstein* of Bond Forms”

Cut, chop, sew, staple. Hmmmmm… THAT looks nice!

(Click for mood music!) You take a regular Payment Bond that provides protection downstream for providers of labor and material. Then you make it go the opposite direction to give payment protect to the project owner or GC.

“We can remove his head and point it the other way!”

  • What is this “Franky Bond” and when do you use it?
  • How do you get one?

This creature is an Advance Payment Bond. You may run into one of these because they are part of the solution for contractors struggling to deal with rising material/equipment prices and long delivery dates. The bond enables contractors/subcontractors to collect payment before the items are installed, delivered to the job site or “suitably stored.” Such payments would normally not be contractually permitted – but our Franky Bond can make it happen. This enables the “Principal” (bond applicant) to collect funds, order the product and lock in prices. It may also help assure delivery at a time when the product is needed. Sounds great, but what is the underwriting? Are these hard to get?

A Performance and Payment Bond is not considered a “strict financial guarantee,” however the Franky Bond is. It is promising the proper handling of funds, or a claim can be made to recover the payment. You have to call that a financial guarantee. Such bonds are approved based on the good financial condition of the applicant.

Even when the principal has filed a Performance and Payment Bond, the Franky Bond may be required to facilitate payment outside the terms of the contract.

So there you have it. There’s always something new in the surety business!

* Don’t call him Frankenstein, he is “Frankenstein’s monster.”
* Do call us when you need a Franky Bond – for Advanced Payment on a construction contract.

FIA Surety: A carrier that provides A rated, T-listed Site, Subdivision and Contract Surety Bonds in all states!

Steve Golia: 856-304-7348


Article by Tyler Dunn at Weissman PC (

Georgia law allows for those providing labor or material for a construction project to file mechanics or materialmen liens (“M&M Lien”) against the property in the real estate records for amounts claimed for that labor or material. Faced with an M&M Lien, builders often feel they have no alternative but to settle an unsubstantiated lien claim or pay to bond it off the project. A few ways to protect against M&M Liens are discussed below.

  1. Final a Notice of Commencement

An owner can get some significant protection from M & M Liens by filing a “Notice of Commencement” and posting it at the project site. The Notice of Commencement must be filed no later than 15 days after commencement of work on the project and must contain specific identifying information prescribed by Georgia law. A copy of the Notice of Commencement must be provided to any subcontractor who requests it in writing. If a Notice of Commencement has been correctly filed and posted, a subcontractor must then provide a “Notice to Contractor” to the owner or contractor within 30 days after providing work or material, thus alerting parties that it is involved in the project and to what extent. The Notice to Contractor gives the owner/contractor the opportunity to make sure the sub-sub is paid, thereby avoiding a possible M & M Lien from that subcontractor. If the Notice to Contractor is not timely provided by the subcontractor, it’s M & M Lien rights automatically terminate.

2. Obtain Lien Waivers

Statutory interim and final lien waivers should be signed by potential M & M Lien claimants when interim and final payments are made to them. It is essential that correct waiver forms be used since other types of forms are generally ineffective and unenforceable. The valid forms of interim and final lien waivers in Georgia were revised in 2021 and these current forms must be used. Ideally, interim and final lien waivers should be obtained from all subcontractors and suppliers. Further, when the final payment for the project is made, the general contractor should sign a “Final Affidavit and Lien Waiver” stating that all subs and sub-subs have been paid.

3. Consider Contracts with Subcontractors

Written subcontracts between builders and their subcontractors can also protect against M & M Liens. While not the norm, these contracts can protect builders by including provisions that directly address M & M Liens. To ease the task, a builder can sign a master subcontract applicable to all projects with each of the customary subcontractors.

(Note from Golia: Florida is one example of a state with similar requirements. Look up “Florida 2021 Statutes, Title XL, Chapter 713” for details.)

Does YOUR state have similar requirements for lien filers? Let me know and I’ll add your comments below. “

FIA Surety: A carrier providing T-listed, A rated Contract, Site and Subdivision bonds in all states!

FIA Surety / First Indemnity of America Insurance Company, Morris Plains, NJ
Need a bond? Call now! 856-304-7348