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How to get a Surety Bond in 2024

Updated: Feb 8

Before diving in, let’s do a quick recap of what a surety bond is. Surety bonds guarantee that the principal (the construction contractor) performs the work according to the contract. In the event they fail to perform according to the contract, a claim can be made by the obligee (the owner of the project) against the principal and the surety will pay out the claim to the obligee as recompense for the time and money lost.

Simply put? Surety Bonds protect buyers from sellers not delivering or performing the agreed-upon outcome.

One last thing, surety bonds are not the same thing as insurance. In fact, they’re much more similar to obtaining a line of credit from the bank. If a claim is made against a contractor, the surety company will pay out the claim immediately, but the contractor must pay back the surety company 100% of the claim amount. Check out our post on Surety Bonds vs. Insurance for more info.

Now that we’ve got the basics down, let’s dive into the steps to getting a surety bond!

Step 1 - Gather your Documents

In order to get a surety bond you’re going to need to have a couple of things handy in order to apply and get approved for a surety bond.

First, you’ll want to know exactly what type of bond you’re applying for. Is it a bid bond, a performance and payment bond, or maybe a license and permit bond? The surety agency will need to know exactly what surety bond you need, along with the dollar amount and project specs.

Second, you’ll need to have your personal and business financial documents ready.

Remember when we said that getting a surety bond is similar to getting a line of credit? It certainly is. In fact, your credit score impacts the amount (the premium) you’ll pay for each bond.

(Don’t have great credit? No problem, there are plenty of options available. An experienced surety agency will be able to help you find the best option for you.)

Aside from your credit score, the surety agency will need to review your recent personal and business yearly financial statements to assess your creditworthiness.

Step 2 - Find a Great Surety Agency

This is not to be confused with finding a great surety company. Wondering what’s the difference between a surety company and a surety agency? Let’s break it down.

A surety company is an entity that underwrites the bond and pays the obligee right away if any claims are filed (remember, the principal must pay back the surety company for any claims paid out).

A surety agency is a middleman who works on behalf of the contractor to get them the best bonding program with a surety company. A licensed surety agent is very knowledgeable about the world of surety bonding and can help you make smart bonding decisions that save you a lot of time and money.

Here’s what to look for when choosing a Surety Agency:

  1. They’re experienced in the world of construction contracting. There are a lot of surety agencies out there that serve a range of industries but don’t specialize in construction surety bonding and won’t be able to give you highly tailored expertise unique to your industry.

  2. They’ll give you a 100% hassle-free, upfront quote free of charge. If any agency won’t give you a free quote upfront, don’t waste your time with them. A quality agency will be happy to provide you with an accurate quote right away, free of charge.

  3. They’ll give you personalized service from day 1. The last thing you want is to work with an agency that doesn’t prioritize your business and won’t give you personalized service. A great surety agency should assign you a personal surety agency that will be your main point of contact for all of your bonding questions. Whenever you have bond questions or need bonding expertise fast, you should be able to pick up the phone and give your agent a call.

  4. They have great reviews from other clients. Sometimes the best way to find out if an agency is worth talking to or not is by hearing what others say about them. If an agency has great reviews or testimonials, that’s a great indicator of what it would be like to have them as your agency.

Step 3 - Get a Quote

After you’ve found a reputable surety agency, give them a call and get a quote. Getting an instant online quote can be useful, but our recommendation is to actually talk to a licensed agent on the phone who can give you tailored solutions to fit your exact needs. It gives you the chance to ask questions and get answers right away.

To get an accurate quote, a surety agent will ask you some questions and gather some documentation, including the type of work you do, what is the largest project you have completed, as well as request a copy of your recent personal and business yearly financials.

From there, the surety agent will talk to a couple of different surety companies to find the best bonding program that fits your needs with the lowest premiums.

Step 4 - Sign the General Indemnity Agreement

After you’ve found a great bonding program that fits your needs, it’s time to sign the General Indemnity Agreement (or GIA). The GIA is the legal document that holds the Principle (you, as the contractor) and your assets responsible for any claims made against the bond. The surety company guarantees that any claims will be paid out, but you are responsible for paying back the surety.

Step 5 - Request a Surety Bond

Congratulations - you’re now ready to get a surety bond! Simply request the kind of bond you need from your surety agent and they’ll get everything ready for your signature.

Wrapping Up

Getting a surety bond is a straightforward process. The right surety agency will make the process seamless from start to finish while finding you the right bonding program for your business.

How to get a surety bond.
How to get a Surety Bond.


Interested in getting a surety bond quote today? The team here at Shorewest Surety would love to help. For the last 20+ years, we’ve been exclusively focused on helping construction contractors get the best rates, expertise, and service possible. We truly care about our clients' success and are honored to partner with them and share our bonding expertise so they can bid on the projects that matter most. Give us a call today at (800) 264-1634 and talk with an agent who will give you a personalized quote.


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