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Surety Bond Training Program Curriculum
The following is a summary of the program sessions:
Session 1, March 21:
Program Overview
Introduction to Surety and Basic Surety Marketing**
Session 1 covers various topics and combined real business insight with initial surety overview. Concepts of marketing (price, product, place, promotion) are introduced to the group. Marketing concepts are married with the general requirements necessary to land surety credit. This is to simplify the idea of surety and encourage participants to understand that in attempting to obtain surety credit, each participant is simply marketing its business to a surety agent, surety company and surety underwriter. Participant companies must be set up in a manner that encourages the surety to buy their product, specifically to issue surety bonds to their company. Rather than confuse participants with complicated surety ratios to start the program, Broadlands demonstrates that landing surety credit is nothing more than a promotion campaign. Participants must be able to promote their businesses to the surety companies in a manner that encourages surety companies to issue bonds on their behalf.
This session covers issues surrounding the psychology of the buyer, general background regarding surety bonds, the main players in the surety market, various bond types and the concept of indemnity.
Session 2, March 28:
Surety Underwriting Basics
This session covers general surety underwriting basics and the main items surety underwriters look for in determining whether to issue surety bond credit. The program outlines the Three Cs of underwriting: Character, Capacity and Capital. Participants are shown various methods in which surety companies evaluate risk in determining whether to approve a bond, including ratios used to determine net worth, working capital and leverage. Participants are taught the role of the agent and underwriter in the surety credit process.
Session 3, April 4:
Business Leadership**
It is not enough that program participants learn surety concepts and strategies for landing surety credit. In order to sustain long-term business success, participants must learn leadership skills required for entrepreneurial success. This session provides in depth leadership concepts that program participants can utilize long after the program concludes.
This session covers various leadership topics: solving important rather than urgent issues, return on investment, building wealth, mission statements, money as compressed energy, specialization, leadership ideas, “Shackelton’s Rules”, emotional intelligence, unconventional interviewing and operational art.
EASTER WEEKEND OFF, NO CLASS APRIL 11
Session 4, April 18:
Mission Statements, Business and Continuity Plans
Without question, one of the more critical elements of the surety underwriting process is the review of the contractor’s business plan. As such a business plan is critical in obtaining surety bond credit. More importantly, it is sound business practice to reduce to writing and implement a business plan that outlines the companies’, goals, objectives, strategies, markets, vision, future, and other elements.
Sureties operating in the small contractor marketplace need assurances that the bonded company will survive personnel hardship related to the principal owner. As such, a detailed continuity plan is important for small contractors. This session sets out several strategies for establishing continuity plans.
At the beginning of the program, each participant will be given a binder containing tabs representing the necessary documents required in order to be considered for surety credit. The notebook contains a tab for each participant to place its business plan.
Bryan will give first 90 minutes of presentation and Ray will give last 90 minutes.
Ray, this is also an opportunity to reinforce your programs and initiate your support efforts with the group.
Session 5, April 25:
Legal Issues Surrounding Surety
Often overlooked in the surety training process are the legal ramifications of surety credit to the bonded contractor. In order to obtain surety credit, the contractor must agree to indemnify and hold harmless the surety company for any and all losses and costs by the surety as a result of issuing the bond. The contractor must understand the consequences of this indemnity obligation and how to protect itself from the surety. In addition to corporate indemnity, the individual owners of the construction company and their spouses will also be required to indemnify the surety. The vast majority of program participants were unaware of this serious obligation.
This session presents program participants with general legal principals of indemnification and strategies for protecting corporate and personal assets from the surety company.
Session 6, May 2:
Advanced Construction Accounting
In order to prepare for the new worth / working capital requirements imposed by sureties during the surety underwriting analysis, contractors must understand key concepts in accounting and tracking income and costs on a project specific and company wide basis. Various methods of construction and project accounting are introduced to program participants.
Also, the session covers various technological methods in maintaining company reports and critical information.
Session 7, May 9:
The Role of the Surety Agent
An important element of the bonding process is the choice of surety bond agent. Almost all surety companies work with independent agents, which present construction contractors to the sureties for possible bonding. As such, choosing an agent is a critical part of the bond process for construction contractors.
Session 8, May 16:
Business Theory for Contractors
This session introduces various concepts in business theory and strategy including specialization, the advantage of being first, business models, testing and refining the business model, networking and connecting and others. In addition, the session addresses the following week’s one-on-one surety review in order to prepare participants for their respective meetings with the program surety underwriters.
MEMORIAL DAY OFF - NO CLASS MAY 23
Session 9, May 30:
One-On-One Interviews
The one-on-one surety underwriting component of the program makes this program unique to Miami-Dade County. There is no other known program that actually incorporates a surety underwriting session with program participants in order to assess surety credit.
Broadlands engineer risk managers will be teamed with First Sealord Surety underwriters to perform a surety underwriting evaluation on program participants.
Session 10, June 6:
Construction Development and Financing
This session covers a variety of topics surrounding real estate development. In order for program participants to understand the construction marketplace, they must understand the factors that drive construction and impact the development of real property. Various real estate development topics were discussed as well as real estate development opportunities in the United States. The session gives participants the view of the owner, developer and lender in the construction process.
Session 11, June 13:
Give Me Some Credit: Credit Enhancement Strategies
This session covers credit reporting and managing credit scores. In order to ensure that participants have sound credit reports, the session covers correcting and maintaining strong credit scores. Credit reports are often the first item a surety will review during its underwriting process. As such, understanding and manipulating credit scores to ensure the best rating is essential for surety credit. Strong credit is also important for working capital loans and other financing needs.
Session 12:
Review, One-on-one Makeups
Click here to download the application.
