Subcontractors and Specialty Trade Contractors
We work with subcontractors across every major trade to establish and strengthen bond programs. Whether you’re getting bonded for the first time or trying to grow your single and aggregate limits, we know how to obtain the results you deserve.
What general contractors and project owners require from subcontractors
On federal projects over $150,000, the Miller Act requires performance and payment bonds from the prime contractor, and most GCs flow that requirement down to their subs. Colorado’s Little Miller Act mirrors this at the state level, requiring bonds on state projects above $150,000 and local projects above $50,000.
On private work, there’s no legal mandate. Many general contractors require bonds from their subcontractors regardless of project type, at thresholds they set themselves. If you’re working to get on an approved subcontractor list, being bondable is a key component.
Why being bonded is a competitive advantage for subs
Not every subcontractor can get bonded. The surety underwriting process reviews your financials, your payment history, your credit, and your track record. Passing that review signals to a GC that you’ve been vetted and that a surety carrier has looked at your business and is willing to back you.
When a GC is choosing between a bonded sub and an unbonded one, the bonded sub transfers risk to the surety carrier. The unbonded sub leaves the GC holding the bag if something goes wrong. GCs know this, and they factor it in.
The larger your bond capacity, the fewer competitors you have. As your limits grow, you can access bigger projects with less competition. Bondability is a marketing tool as much as it is a compliance requirement.
Bond types for subcontractors and specialty trades
Bid bonds are typically not required for subcontracts, but GC’s will still want to ensure you can provide performance and payment bonds if you are awarded the project.
Performance and payment bonds are issued together, each equal to the full contract value. A $500,000 subcontract means a $500,000 performance bond and a $500,000 payment bond, for$1,000,000 in total limit. The performance bond guarantees you’ll complete the work per the contract terms. The payment bond guarantees you’ll pay your lower-tier subs and material suppliers.
We also provide bondability letters for GC prequalification portals, which document your bonding capacity and carrier relationship without issuing a formal bond.
Specialty trades we work with
The surety underwriting process is largely the same across trades. What changes is the financial profile of each business. We’ve worked with subcontractors across electrical, mechanical, plumbing, HVAC, roofing, drywall, concrete, structural steel, glazing, waterproofing, paving, and more.
If your trade isn’t listed here, reach out anyway. If you need a bond, we can work with you to figure out whether one is obtainable and what it will take to get there.
How we help subcontractors build stronger bond programs
Getting a bond is one thing. Growing your capacity over time takes a more structured approach. We work alongside your CPA, banker, and other advisors to identify what’s holding your program back and build a plan to address it.
That means analyzing your financial statements against the ratios surety underwriters actually look at – working capital, equity, revenue concentration, and cash flow. It means reviewing your contracts to flag problem language before it creates an issue with your carrier. And it means submitting your account to the right carriers for your profile, not just the most convenient one.
We’re appointed with 15 surety carriers. For subcontractors with non-standard financial profiles or limited history, that appointment depth matters.
We’re also an SBA-appointed agency, which gives qualifying subcontractors access to the SBA Bond Guarantee Program, and a path to higher capacity that most competing agencies can’t offer.
What usually gets in the way of subcontractor bonding
Most subcontractors who struggle to get bonded share a few common issues. Thin working capital is the most frequent one. Surety carriers want to see enough liquidity to handle the project without running short. Equity that hasn’t been built up over time is another. Personal credit is also part of the underwriting picture, especially for smaller firms where the owner’s financial profile is closely tied to the business.
Financial statements are often a sticking point too. Carriers want to see organized, current financials, preferably either CPA-reviewed annual statements or consistent internal monthly or quarterly reports. If your books aren’t in order, that’s usually the first thing to fix.
None of these are permanent obstacles. They’re things we can help you work through over time. The client who can’t get bonded today can often get bonded 12 months from now with the right plan in place.
Ready to get bonded or grow your capacity?
If you need a bond to win a job, or you want to build a program that opens up bigger projects over time, contact us directly. We’ll take a look at your situation and tell you exactly where you stand.
Call Eddie Maxfield at 720-492-9258 or email him at emaxfield@evergreensurety.com