Matt Gaynor

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Recommended Strategies to Open Capacity for your Bond Program

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

Most of our contractor bond accounts are provided a single bond/aggregate capacity program to determine the size of projects they can bid and the amount of capacity that is available in the program for future projects. The most effective way to ensure you have available capacity for an upcoming bid is to communicate with your bond agent well in advance of the bid date to ensure the project will be approved by the bond company. On certain occasions, an upcoming project may put you over the top of your approved capacity. This is the time your agent must work hard on your behalf to represent to the bond company why this project makes sense to add to the program. 

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Stand Out Among the Crowd with a Surety Prequalification Letter

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In advance of a project bid, some owners and general contractors will want to pre-qualify the subcontractors to ensure they can handle a project of a certain size. A simple and efficient way to accomplish this would be to have the surety agent that supports the contractor’s bonding program prepare a surety prequalification letter. 

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Surety Bonding: Understanding the Client-Broker-Carrier Relationship

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

People from outside the surety bond industry will sometimes ask if we work for 1) the carrier (bond company) or 2) the contractor client. This is an easy one. While we are approved to issue bonds by the 20+ carriers we are appointed with, make no mistake that we work 100% for our clients. 

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Performance Bonds for Private Equity Contractors

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

We have entertained several recent submissions from our construction division prospects looking for bonding support of their companies that are majority owned by a private equity firm. The traditional surety market will push back on private equity submissions pointing out the goodwill and large amount of debt listed on the balance sheet. Throw in the limited indemnity package offered in support of the bond program and we have created a perfect storm for the account to be declined without any actual underwriting taking place. But there is hope!

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Need a License, Permit, or Court Bond? Rancho Mesa Can Help

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

During our recent budget discussions for the 2024 fiscal year, the Rancho Mesa Surety Department looked at a breakdown of the bonds we wrote in 2023.  As expected, 90% of our bond revenue was represented by the typical performance and payment bonds, subdivision bonds, bid bonds, bond riders, and consents of surety for our construction clients.

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Risk Tamed and Rewards Claimed: Requiring Subcontractor Bonds

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

We often receive questions from our contractor clients regarding if/when they should require a subcontractor to provide the protection of a performance & payment bond for a project. Although the premium charged for the bond will add cost to the project – on many occasions the benefit of the bond will far outweigh the cost. 

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Take Advantage of Contractor Express Bond Programs

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

Several years ago, I put together an article on various credit driven surety bond offerings that require a one-page application to qualify for bonding. Quick and simple! At that time, the maximum limits offered by various carriers was $350,000 for a single bond.

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Five Things to Know Before Your Annual Surety Meeting

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

November is the month that I meet with our contractor clients to discuss how the current year will end up and begin planning for the next year. We will also touch base regarding the items our surety carrier partners will want to hear about when we schedule our annual meetings (after the December 31, 2022 financial information is available).

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Choosing the Best Surety Partner for Your Contractor Bonding Program

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

The Rancho Mesa Bond Department is currently appointed with twenty-five surety carriers to support our contractor clients with all sizes of bond programs. It is key that the contractor is matched with the correct bond company to ensure timely approval for bonding. For both new and existing clients, we look at several factors to ensure you are partnering with the bond company that will provide the best single and aggregate bond program at the most competitive rate.

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Changes Are Coming to California Contractor License Bonds

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Author, Matt Gaynor, Director, Surety Department, Rancho Mesa Insurance Services, Inc.

Currently, all contractors licensed in the State of California are required by the Contractors State License Board (CSLB) to have a $15,000 contractor license bond on file with the state. This amount has been in effect since January 1, 2016.

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Construction Law and the Future of the Industry With Carlin Law Group

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Rancho Mesa's Director of Surety Matt Gaynor interviewed Kevin Carlin of Carlin Law Group on Wednesday, March 23, 2022 to learn about his background, where he started his law career, and current hot topic’s in the construction industry. Kevin is a well-respected construction attorney here in Southern California who represents a number of Rancho Mesa clients.

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Understanding Single and Aggregate Surety Bond Limits

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

When we work with the bonding carriers on surety credit programs for our contractor customers, we traditionally put into place single and aggregate bond limits. This provides our contractor clients certain parameters when they are considering a maximum project size for bonding purposes.

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Surety Keith Clements from Tokio Marine HCC

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Author, Alyssa Burley, Media Communications and Client Services Manager, Rancho Mesa Insurance Services, Inc.

Rancho Mesa's Director of Surety Matt Gaynor interviewed Vice President of Tokio Marine HCC Surety, Keith Clements on Wednesday, September 15, 2021 to learn about his background, his role with Tokio Marine HCC and how the company fits into the surety marketplace.

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Closing Your Bond Liability – Understanding the Consent of Surety Document

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

The project our contractor client was required to bond has been completed and they are looking to get their final payment and collect their retention. But the owner or general contractor is requiring a Consent of Surety document from our contractor. What is a consent of surety and why is this document required?

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Bondability Letters – Surety Prequalification for Owners and General Contractors

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

In the normal process of bidding a construction project, our contractor clients are required to post a 10% bid bond to guarantee that they will execute and deliver a signed contract along with 100% performance and payment bonds, if they are awarded the referenced project. While this is a requirement for public projects, bid bonds have also become more prevalent for certain private projects. By approving the required bid bond, the surety company provides their stamp of approval that they have reviewed the bidding documents and are willing to support the contractor for the specific project.

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Get Your Bond Account in Shape for 2021 – A Surety Company Perspective

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

As we wind down the 2020 year, it is important for our contractor clients and prospects to start planning how the 12/31/2020 fiscal year end financial statement will look. The bond companies will use this information to set your 2021 Bond Credit Line for approval of your projects.

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Bond Companies Thoroughly Track Status of Construction Projects

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

When the bond company approves a performance and payment bond for our contractor clients, they want to keep track of the project until completion - at which time the liability for the bond is no longer on their books. One tool they use to track a construction project is the Work In Progress Report (WIP) which the bonding company analyzes on a quarterly or six-month basis to track the profitability of the project on a percentage of completion basis. When the bond company sees that a project is 100% complete on the WIP or Completed Contract Report, they will mark the bond file as “closed,” once the warranty period has expired.

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Why Am I Now Required to Bond Such Small Construction Projects?

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Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

I received an email from a large Subcontractor client last week requesting performance and payment bonds in the amounts of $87,000 and $133,000, respectively. This client has completed projects in excess of $5,000,000 in the past and was surprised that the general contractor they were working with was requiring such a small amount to be bonded back.

Have You Met With Your Bond Company This Year?

Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.

In the world of surety bonding, the various financial information the bond underwriter will analyze includes the Balance Sheet, Income Statement, A/R & A/P Aging, Bank Line of Credit, Work In Progress Schedule, and the owner’s personal financial statement. This is to determine the level of single project and aggregate program credit line to support the contractor’s bonding.

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