Surety Bonds: Beware the False Asker

By Steven Golia

Surety Bond Producers have one main goal: produce the business and move on.

You know there is a process when submitting a surety bond for approval but hate that sick feeling when the underwriter comes back with a ton of questions. Let's face it, customers just want to complete the transaction and get on with their lives. They have more important things to do than fill out forms, scan documents and complete applications. You know you'll get push back from your client if you bug them.

What's more, the questions may result in a dead end, a declination! Did the underwriter already form an opinion? Did they already decide the account is not for them, but just want to complete the file... to have a complete file?

We will call such a person the "False Asker" - an underwriter who puts you through the paces, just to say no at the end. They never really wanted to write the bond and are developing the file under false pretenses. They send you on a fools mission. It is 100% a waste of your time!

Or maybe questions are the opposite... The bond underwriter thinks the account may be a fit, but just needs to check a few more points. This could be the first step on a successful journey. Here's more: There may be something wonderful about the questions good underwriters ask. Let's explore.

When reviewing the file, the analyst marks off elements of strength and weakness. For example, the company is 10 years old, but current management has only been in place for a year (a plus and a minus). Or maybe the Net Worth is strong, but debt is high resulting in too much leverage. If there is more good than bad, an approval may be in order - after additional development.

Now comes the gift: The key points, the underwriting questions, are an insight to the decision making process. They are keys to the underwriter's mind. With favorable answers, authorization may ensue. The questions chart a course that the producer could imagine but not confirm. In this manner, the underwriting questions are priceless, the keys to success.

Remember, there is room for frustration on the underwriter's side, too.

Q. Which of the underwriting questions are optional? You know, the unimportant ones.

A. They are all important.

Thus the frustration when we ask 5 Q's and get back 3 A's. Then re-ask the 3 and get back only 2. You get the idea.

It all comes down to this: Beware the False Asker. You must avoid that person who churns the file and wastes your time. Every producer has been through it. You answer questions for two weeks and get a declination they could have figured on day one - and not wasted your time.

A good underwriter only develops an account they intend to support. They like it and want to proceed, but must tidy up the file. Their Qs are a gift, the path forward, the key to your success if you follow through willingly and diligently.

Judge all of us by our performance:

Good underwriters are prompt. For example, our office provides a same day response on all submissions.

Are our responses concise and easy to understand?

Do we offer a prompt declination or clear path forward, defined by the underwriting questions that will get the deal done?

A good surety underwriter can be your important ally and business partner. Choose us carefully based on performance, and always Beware the False Asker!

Steve Golia is the National Surety Director for Great Midwest Insurance Company, an A-8 carrier specializing in contract surety.

The company provides Performance and Payment Bonds with speed and creativity, up to $10 million per contract.

Contact us today and let's discuss how we can help - even if others have failed. Call 856-304-7348.

Visit us Click!

Article Source:  Surety Bonds: Beware the False Asker