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ORLANDO — A Florida contractor was granted its request against a former partner, according to a May 7 opinion of the U.S. District Court in the Middle District of Florida Orlando Division. Defendant Archer Western Contractors, LLC was hired by the Florida Department of Transportation to help with the construction of the Central Florida Commuter Rail Transit Station Project (Sunrail Project). Archer then went into partnership with Prince Land Services Inc., whose responsibilities were to do landscaping and irrigation for the Sunrail Project. Developer Surety and Indemnity Company (DSIC), the plaintiff, operated as surety when it provided a subcontractor performance bond with Prince named as a subcontractor and DSIC as surety, and Archer as obligee. The working relationship went awry after Prince allegedly defaulted on the subcontract. DSIC requested a declaratory judgment that Archer violated the bond agreement when it hired another subcontractor to replace Prince. DSIC and Archer filed a motion for summary judgment after Archer filed a counterclaim and stated DSIC was the party to breach the bond agreement, that Archer was justified in hiring a replacement contractor, and that DSIC is responsible to pay Archer the cost of remediating Prince’s default. It also stated DSIC owes Archer $631,148.65 plus fees and cost. The district court denied DSIC’s motion for summary judgment. It stated Archer did not violate the bond when it replaced Prince amid its default. The court pointed out the company’s actions during DSIC’s notice that Prince was in default stopped DSIC from moving forward with settling Prince’s default. The district court pointed out that hiring the replacement company was a good move as DSIC was unable to solve Prince’s default status. The district court also ruled Archer didn’t breach the bond when it didn’t provide DSIC with information to prove Prince’s claimed breach. Considering this, the court denied DSIC’s motion for summary judgment. The court then granted Archer’s motion concerning its counterclaims in requesting a declaratory judgement that DSIC breached the bond, as well as claims the company is responsible for the costs of remediating Prince’s default. It found DSIC is responsible to Archer through the terms of the bond and subcontract. “Archer acted in accordance with the subcontract and the bond at every stage, while DSIC’s conduct breached the bond,” the court ruled.

May 15, 2018 – Rockville, MD-based search firm JDG Associates has been selected to find the next president of the Surety & Fidelity Association of America (SFAA). Lynn M. Schubert, the group’s current president, announced in December that she would be retiring at the end of this year. Paul Belford, principal at the recruitment firm, is spearheading the search. Ms. Schubert, who has led Washington, D.C.-based SFAA for 22 years, is assisting the organization’s search committee in finding her successor. Among her accomplishments, she was the first woman to head a national insurance trade association. The next president, who will oversee a $5.5 million annual budget and a full-time staff of 16, will be charged with providing vision, direction and leadership in promoting and preserving the use of surety and fidelity bonds in the public and private markets, said JDG Associates. The president provides the board of directors with information and guides the association in taking policy positions, and is responsible for advocacy of those positions. Broad Responsibility The president role includes responsibility for all aspects of SFAA’s work, including its member services as well as external activity, said the search firm. The leader manages the financial viability of the association, balancing services against current market conditions, and oversees and provides guidance to the board on all management issues, including staffing and benefits. The successful candidate will lead a highly regarded, financially sound association whose member company products protect the public interest in infrastructure and related projects nationally, said JDG Associates. The individual will work with highly-engaged senior-most executives of national and local companies who rely on the quality of its statistical resources and advisory services in the management of their companies. Ms. Schubert, the search firm said, is leaving her successor with a solid platform and position to promote and advance the benefits of surety and fidelity products. The next president will be expected to provide the leadership, management and motivational spirit needed to continue that success. SFAA’s next leader will also be expected to provide guidance to the board on all association-related issues as well as implement its policies and programs. The individual will act as the industry leader in promoting and protecting surety and fidelity bonds, strengthening policy maker and industry leader awareness of their benefits and utility, to include testifying before Congress and other bodies, as appropriate, said the search firm. A Range of Duties Other responsibilities will include: positioning SFAA as the industry expert for regulators, legislators and public entities on all matters related to surety and fidelity bonds; developing and supporting SFAA staff capabilities in all substantive, statistical, actuarial and legal matters related to surety and fidelity bonds, managing all officers and direct reports to ensure an effective, efficient and positive working environment throughout SFAA; serving as a trustee for the Surety Foundation, overseeing its activities and being a resource to it; and managing all fiscal matters including investment policies, reserve policies, and SFAA’s budgets, benefits, retirement plans, assessments and non-dues revenue generation, among other duties Candidates must at least have a bachelor’s degree, although a law degree is preferred. They should also have experience in insurance and finance fields; knowledge of the surety and fidelity field is highly desirable. Prospects must have leadership abilities, including experience in working with CEO-level executives of national firms, said JDG Associates. They must also have excellent oral and written communication skills, with a successful track record in representing an organization before policy makers and with industry leaders on legislative and regulatory matters SFAA would further like prospects to have had success in expanding an organization’s market reach, such as increasing private-sector use of surety bonding. Demonstrated success in working with a board of directors or similar body is highly desirable. Excellent relationship development skills, a collaborative mindset as well as success in consensus development are required. Candidates should also show strengths in strategic thinking and direction-setting as well as attention to detail. The job also calls for an understanding of the role and dynamics of a fully functioning and highly effective trade association. SFAA, founded in 1908, is licensed as a rating or advisory organization in all states and it has been designated by state insurance departments as a statistical agent for the reporting of fidelity and surety experience. SFAA serves as a trade association of more than 400 insurance companies that write the vast majority of surety and fidelity bonds in the U.S. Veteran Recruiters JDG Associates has been providing executive recruitment services to Fortune 1000 corporations, associations and non-profits, federal, state and local governments, research & consulting firms, and defense contractors since 1973. Mr. Belford has completed nearly 300 association searches during his career, mostly for CEO roles. A professional search consultant since 1990, he joined JDG Associates in 1993. His clients have ranged from regional and state groups with staffs of 10 or fewer to national organizations with budgets up to $75 million. He has worked with trade associations and professional societies from a wide range of service areas, including heavy industry, information technology, finance, healthcare, engineering, government relations, communications, finance and administration. https://huntscanlon.com/jdg-associates-seeks-president-for-surety-fidelity-association-of-america/

The Preliminary 2017 Top 100 Reports have been posted for Members and Subscribers. Non-Members may purchase these reports by completing a Statistical Report Order Form. Click here for a complete list, description, and release schedule of statistical reports. http://www.surety.org/news/77681/Preliminary-2017-Top-100-Reports-posted.htm

Commercial surety in the US is a recipe for success if you understand the intricacies and complexities of the market. The product is booming as an alternative in lieu of traditional letters of credit (LOC) and there’s ripe fruit for the picking. “The US commercial surety market is experiencing growth that’s faster than the overall insurance market and faster than North American GDP growth. That’s largely due to increased use of the product as an attractive alternative to letters of credit (LOC) and more obliges accepting bonds in lieu of LOCs,” said David Hewitt, US Surety Practice Leader, Marsh. “In the past few years, there has been lots of concern around interest rates. Many of our clients were looking for alternatives to putting up an LOC,” Hewitt added. “This led to more discussions and education around the product, which has helped it grow in popularity.” Results in the US commercial surety market have been positive for about 10 years, with an average 20% loss ratio or lower, which has enticed new entrants into the niche market. Pricing has been consistently dropping for at least three years, and the overall market continues to expand despite declining rates. The US remains an attractive market for global players to enter. Globalization is an increasing trend within US-based surety portfolios. As more firms enter the US and sign contractual documentation, the need for the surety product continues to expand. “We’re also seeing a lot of increased demand for commercial surety bonds for deals between US companies. Large corporates are using the product more and more, and if they have a good experience with it, the uptake increases,” Hewitt told Insurance Business at RIMS 2018. “I think the product is a really good alternative for any company that uses LOCs today, to help manage some of their risk “The universe where LOCs are used is huge and the different types of obligations parties are required to meet are almost too many too count. Many who previously looked to manage their risk through an LOC are finding that surety bonds provide a really good alternative in lieu, which often comes at a cost advantage, leaving borrowing space available for other financial necessities.” https://www.insurancebusinessmag.com/us/news/breaking-news/commercial-surety-bonds-attractive-alternative-to-locs-99478.aspx