The Three C's of Surety Agent E&O Presented by: Edward M. (Butch) Weed Martin Weed, LLC

The Three C's of Surety Agent E&O Presented by: Edward M. (Butch) Weed Martin Weed, LLC 100 Union Hill Drive, Suite 150 Birmingham, Alabama 35209 (205)443-6661 (direct) emweed@martinweedllc.com August 28, 2012

Three C's of Surety Agent E&O How to use Character and Capacity to avoid spending Cash on attorneys (Like the one talking to you now). August 28, 2012

Speaker@NASBPConvention August 28, 2012

Edward M. (“Butch”) Weed Surety Bond Underwriter, USF&G, Birmingham, AL 1984-85 Licensed Producer/Agent, The Wend Agency n/k/a International Assurance, Mobile, AL 1985-88 NASBP Conventions, Kiawah Island, SC NASBP Agent School, Houston, TX USF&G Agent School, Baltimore, MD CPCU Designation (completed in two years, 1985-1987) August 28, 2012

Edward M. (“Butch”) Weed: NASBP Member turned Attorney Defense Litigation Attorney since 1991 (Insurance, Surety, Professional Malpractice, Construction, E&O, Environmental) University of Alabama, BS in Corporate Finance and Investment Management 1984, JD 1991 August 28, 2012

Three C's of Surety Agent E&O Why are we here? August 28, 2012

Three C's of Surety Agent E&O “What actually happened?” versus “What someone (usually a non-agent) suggests should have happened?” August 28, 2012

Three C's of Surety Agent E&O I. Cash II. Character III. Capacity August 28, 2012

Three C's of Surety Agent E&O III. Capacity of NASBP members: A. Knowledge B. With Ability to Apply Knowledge to Get Results (Wisdom/Savvy/Experience) C. Ability to Recognize When Results May Not Be Possible D. Skills and Technology August 28, 2012

Three C's of Surety Agent E&O III. Capacity of Professionals in Surety Bonding: A. Knowledge (Things Agents Know): 1. Properly Trained, Experienced Surety Agents, such as those with NASBP membership, are the smartest people in the industry-as the NASBP logo reads, you are “Professionals in Surety Bonding.” Understand that with that membership, comes responsibility. 2 Agents Don’t Underwrite. 3. Agents Don’t Handle Claims. 4. Good Relationships Are the Key to Success. August 28, 2012

Three C's of Surety Agent E&O III. Capacity: Knowledge and Applying Knowledge NASBP = smartest people in the industry: The Surety is counting on you to get asked for information. The Contractor is counting on you to get the bond. When things go bad, as the smartest person around, you could be blamed! Document and Document, as you do already... Emails can save you-Assume every one is evidence. August 28, 2012

Three C's of Surety Agent E&O Emails, Emails, Emails! • Found everywhere • What Attorneys use to reconstruct events • What Courts will rely upon as Evidence August 28, 2012

Emails=Documentation=Evidence 1. Be polite. 2. Identify the important stuff (contractor, project and what is being sent). 3. Specify the next step. 4. Be short-no narratives or irrelevant stuff. August 28, 2012

Good Email August 28, 2012

Bad Email August 28, 2012

Three C's of Surety Agent E&O III. Capacity: Knowledge and Applying Knowledge 2. Agents Don’t Underwrite. • Provide the asked for Information. • Don’t Analyze Information Yourself. • Allow Surety Underwriter to do job. • Deal With Voiced Concerns. • Let Surety Make Decision. August 28, 2012

Three C's of Surety Agent E&O III. Capacity: Knowledge and Applying Knowledge 3. Agents Don’t Handle Claims. Agents Should Never Handle Claims: Why? • Surety Bonds Unlike Insurance • Theoretically No Claims • So you should have NO experience • If Actual Claim, Don’t Act Like NBD • Pass Information on to surety and get out August 28, 2012

Three C's of Surety Agent E&O III. Capacity: Knowledge and Applying Knowledge: 4. Good Relationships Are the Key to Success; Surety Relationship > One Bond Contractor Relationship > One Bond (hopefully) One Bond < all the relationships put together August 28, 2012

Three C's of Surety Agent E&O III. Capacity C. Ability to Recognize When Results May Not Be Possible Recognize that you are not: • a contractor • a surety • a state insurance department • a banker • an accountant • a lawyer • an owner, state highway department, or other such entity August 28, 2012

Three C's of Surety Agent E&O III. Capacity C. Ability to Recognize When Results May Not Be Possible Recognize that you are not: • a contractor They bid and build, and risk assets and jobs, you don’t • a surety They have guidelines to reject bonds, you don’t • a state insurance dept. They make judgment calls on sureties, you don’t • a banker They can lend working capital, you can’t (shouldn’t) • an accountant They prepare financial statements, you don’t • a lawyer They draft the contracts and fight the battles, you don’t • an owner They have work to award, you don’t In short, do not try to be something you are not: Your role is important, and so is theirs. August 28, 2012

Three C's of Surety Agent E&O III. Capacity A. Knowledge B. Ability to Apply Knowledge to Get Results C. Ability to Recognize When Results May Not Be Possible D. Skills and Technology August 28, 2012

Three C's of Surety Agent E&O III. Capacity D. Skills and Technology. Use the skills you make your living with to see if concerns can be addressed before the lawyers get involved: • Listen • Identify the Concern • Suggest Possible Means of Resolution/Prevention of the Problem Going Forward August 28, 2012

Three C's of Surety Agent E&O III. Capacity D. Skills and Technology • Technology exists, make it your bff (best friend forever). • Like many good friends, it already does everything you want, you probably just never noticed. August 28, 2012

Three C's of Surety Agent E&O Required Computer Skills and Technology: 1. The ability to locate ANY document or data from your system. 2. And send it anywhere. 3. And recognize how data is stored, and what it means if data doesn’t exist. August 28, 2012

Three C's of Surety Agent E&O To make technology= bff : ) • Identify types of file on your desktop. • Find out how backup is handled. • Do system searches. August 28, 2012

Three C's of Surety Agent E&O CHARACTER August 28, 2012

Three C's of Surety Agent E&O(Kipling’s Lessons) August 28, 2012

Three C's of Surety Agent E&O August 28, 2012

Three C's of Surety Agent E&O • Character is a yes/no question in underwriting, and should be in your business. • There is no in-between and partial credit is not given. • While lessons on character are far beyond the scope of a one hour webinar, what Kipling said about character are the same things you should look for in: -yourself; -employees and -everyone you are associated with. August 28, 2012

Three C's of Surety Agent E&O Thanks for your time! Edward M. (Butch) Weed Martin Weed, LLC August 28, 2012

YOUR QUESTIONS? If you do not have the opportunity to have your question addressed during the Seminar, you may contact the presenter directly: Edward M. (Butch) Weed Martin Weed, LLC 100 Union Hill Drive, Suite 150 Birmingham, Alabama 35209 (205)443-6661 (direct) emweed@martinweedllc.com 37 August 28, 2012

The Three C's of Surety Agent E&O Presented by: Edward M. (Butch) Weed Martin Weed, LLC