Surety bonds are vital for construction project owners to ensure job completion. They absolve them of the risk of a contractor failing to complete their job. They also play a crucial role in providing financial security and promoting trust between all parties involved in construction projects.
Michael Zahn, a surety sales executive at Marsh McLennan Agency, spoke with Construction Executive about how an ownership transition can affect a construction firm’s ability to obtain surety bonding.
“Because an ownership transition typically results in material changes to the balance sheet and is partially or wholly funded by the entity's assets, access to surety credit can be significantly impacted by the resulting equity and/or liquidity reduction,” says Michael.
