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.
What is a Surety Bondability Letter?
Author, Matt Gaynor, Director of Surety, Rancho Mesa Insurance Services, Inc.
When an owner or general contractor is looking to pre-qualify a contractor for a specific project, they will often request the contractor to submit a bondability letter from their bond agent. The bondability letter provides the owner with an assurance that the contractor has been underwritten and approved by a surety company for support of a specific project. The bondability letter is issued for no cost (it is regarded as a standard service provided by the bond agent).