Neill Bonding/Alabama Surety Bond (AL)/Surety Bonds/Risk Classifications

How do you know if you are being charged the correct bond premium? Bond premiums are determined in large part on length of time in business, quality of organization, and financial strength. However Construction Bonds are also classified in different Risk Classifications; for instance a highway project has a lower risk element than say a high-rise building. The Suret Industry has three(3) main risk classifications. They are Class B, Class A, and Class A-1.

Class B Construction Projects are typical vertical construction, most all trades associated with it, utility work, digging work, excavations, sewage disposal plants, etc.

Class A Construction Projects include  clearing, grading and grubbing where no ultimate improvement is involved, curbing and guttering, athletic fields, etc.

Class A-1 Construction Projects include highways, roads, street paving and airport runways and paving contracts that do not include widening, bridges or base construction, as well as fire alarm systems, etc.

This is only a very brief overview of the different risk classifications that Surety companies use to classify risk. You may be paying more than necessary if your Bonding Agent is not  familiar with these different Risk Classifications. It can add up to a lot of dollars if classified incorrectly.

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