“Raising the Bar” of Our Commitment to Improve the Surety Industry and to Further our Careers and Help meet the Needs of the Beneficiaries of Surety Bonds

In preparation for serving as your President, I wanted to understand how NASBP formed 70 years ago. From my research, I learned that, in a political environment that is remarkably similar to what we know today, the founders of NASBP created the Association to ensure that bond producers had an organization that would advocate for both the surety product and bond producers.

Look Where NASBP Started

In the spring of 1942, six agents and one surety company executive laid the ground work for our Association as a response to the War Department’s plan to cut surety bond premiums by as much as 19% and commissions by as much as 86% on contracts relating to the War effort. These seven developed a brief explaining the value of surety bonding and the role of the bond producer, and they presented the brief to the head of the War Department Insurance and Bonding Office, Colonel Reece Hill. After much debate with War Office representatives, they settled on a reduction of no more than 2 1/2% of the agents’ commission. The NASBP founders met six months later to establish the following objectives of the Association:

• to promote the general welfare of those engaged in the production of surety bonds,
• to further closer fraternal relationship among its members,
• to obtain and disseminate helpful information,
• to adopt expedient rules and regulations and secure advantages of united action plans and procedures among its members so as to promote their general welfare,
• to safeguard and protect public interests and inspire public confidence.

Although we have expanded exponentially what we do as an Association, we have the same core values and goals that started NASBP, and these remain the focus of our efforts today. Just as our founders experienced, we too are seeing significant challenges to the surety industry, and we must address them. As President, I would like to ask you to re-examine your role in the Association and to take action to become more involved, first, to improve the surety industry and, secondly, to further your career and help meet the needs of the beneficiaries of surety bonds.

Become More Involved to Improve the Surety Industry

This is a time when we must battle to protect our product from nefarious attacks and attempts to decrease its use. First, I am challenging the NASBP membership to “raise the bar” and expand our efforts in the political arena on national, state and local fronts.

In hard economic times like the past four years, it is easy to say, “I’m too busy to work on surety industry concerns,” when what we should be saying is, “I need to be doing whatever I can to protect and to preserve this industry, so I not only have a job, but it is a job with true value and meaning.” I would like to see NASBP increase the Association’s advocacy efforts beyond even the unprecedented legislative accomplishments that the Association has achieved recently.

As you are aware, NASBP had success lately in its political efforts to enact federal legislation, HB 3534, The Security in Bonding Act of 2012, which has passed the House. Now NASBP needs your help to see it pass in the Senate. Be on the look out for NASBP communications explaining how you can help. In addition, NASBP’s hard work in the state of Maryland paid off and brought about a law that will act as a deterrent to unlicensed persons who are writing surety bonds on private contracts in Maryland and harming Maryland consumers and businesses.

NASBP also is undertaking proactive steps to blunt anti-surety views in New Mexico that could translate to the introduction of proposed legislation that would threaten the surety product. Other states continue to propose legislation that waive bonds and increase bond thresholds. NASBP needs all surety professionals to become activists to oppose these kinds of adverse measures. Keep NASBP apprised of the threats to the surety product in your state and, if necessary, plan to attend local and state hearings and provide written testimony that opposes them.

We need your involvement. If you do not already know your local, state, and federal elected officials, then you need to take steps to meet these people and get to know them. How? One way to get to know your federal legislators is to join your colleagues in D.C. for our Fly-in, June 26. Members of Congress like to talk to their constituents, namely you. We have a great line-up of speakers. Senator Rand Paul (R-KY), Representatives Steve King (R-IA) and Brian Higgins (D-NY), and Emily Murphy, senior counsel, House Small Business and Entrepreneurship Committee have agreed to speak at our policy briefing session before we go to the Hill for our Congressional meetings. There is still time to sign up. Any latecomers that do not have time to set-up a meeting with their members of Congress can join other groups that have scheduled appointments. We all must support this event with our presence. The more in attendance, the more our message will be heard in Washington.

Become More Involved to Further Your Career and Help Meet the Needs of the Beneficiaries of Surety Bonds

Secondly, I challenge each of you to become more involved to further your career and help meet the needs of the beneficiaries of surety bonds. Increase your level of activity in NASBP this coming year by doing just one more activity or program this year, than last year. By doing so, we collectively will be “raising the bar.”

We need to set our sights on doing more to foster our shared goal of bettering our lives as surety professionals and meeting the needs of beneficiaries of bonds. For example, make a commitment to recruit a new member, attend your NASBP regional meetings, participate in your local surety association, or attend or send one of your support staff or producers to a NASBP educational offering, such as the NASBP Federal Contracting Workshop, Sales Workshop, Construction Contracts Workshop, or Surety School. Remember the convenience of participating in a NASBP Virtual Seminar or completing the Commercial Surety Fundamentals online course.

Where We Are Today

Our Association over the past five years has transformed itself into a modern, efficient, proactive, relevant, and energized NASBP that every day expands its outreach and influence. NASBP added the Associate category to the membership classifications. We have increased and enhanced NASBP educational opportunities. For example, NASBP is offering Workshops addressing construction contracts and producer sales skills, Virtual Seminars on current surety topics, and Summer and Winter Offerings of the William J. Angell Surety School. NASBP has expanded and improved its communication channels by offering the NASBP SmartBrief, NASBP SuretyConnect, Pipeline newsletter, Focal Point legislative e-bulletin, NASBP Dispatch – issued mid-year, and NASBP Highlights-Year in Review report. NASBP has established a social media presence through SuretyConnect, NASBP LinkedIn, NASBP Twitter, and NASBP FaceBook. Also, NASBP has taken efforts to familiarize those who want to pursue a leadership role in the Association with NASBP guidance; NASBP has developed a new NASBP Leadership Guide and multiplied the 5-15 Leadership Circle’s offerings.

If you were unable to attend the Annual meeting in Orlando, you missed a great event that offered many networking and educational opportunities. The JW Marriott Orlando Grande Lakes was a great venue—beautiful facilities and golf course. John Rindt and his Annual Meeting Program Committee, led by Co-chairs Paul Amstutz and Tracy Tucker, delivered an outstanding program. During the meeting, we were updated on the state of the insurance industry by our Keynote Speaker Peter Wilson, President and COO of CNA Specialty Lines. The breakout sessions were packed. One of them addressed success stories of small and emerging subcontractors and another covered how accounting and surety credit vary based on company structure. For more information about these and other sessions at the Annual Meeting, see the article on Annual Meeting in this issue of Pipeline. The Tuesday night party, featuring a “Wizard of Oz” theme, was amazing with JR as the Wizard supported by the terrific band, “Emerald City.” It was a fantastic evening!

Where We Are Headed

Over the past three months, the NASBP Leadership started developing a five-year strategic plan, titled “NASBP Vision 2017.” This path will lead us into an even greater sphere of influence in all aspects of our operations and in our outreach to strategic partners in the surety, construction, and insurance industries. We want to add value to your membership by continued expansion of all aspects of NASBP. For example, we know knowledge is power, and we want NASBP members to be able to “raise the bar” by being well informed about a surety issue when an opportunity presents itself to them. We want our 5-15 Leadership Circle to be a “must do” for our young members who will eventually lead the Association and the industry. This endeavor, started by Past President Steve Cory, is already proving its value. We have several NASBP Directors and Committee Chairs who are in or have benefitted from their membership in the 5-15 Leadership Circle.

Last month in Washington DC, the NASBP Executive Committee, consisting of Larry McMahon, Tom Padilla, Susan Hecker, John Rindt, and myself, and the NASBP CEO Mark McCallum, met with the Surety & Fidelity Association of America (SFAA) leadership during the SFAA Annual Meeting. The SFAA representatives in attendance included Tim Mikolajewski of Liberty Mutual, Stephen Haney of ACE Surety, Ross Fisher of The Hartford Fidelity & Bonding, Larry Taylor of Merchants Bonding Company, Thomas Kunkel of The Travelers Companies, and Lynn Schubert, President of SFAA. We had the opportunity to review current issues, market expectations, capacity availability, and new trends in the industry. Most things are as to be expected with the decrease in construction spending, but there is significant thought and discussion on how the introduction of Private Public Partnership-financed projects will affect the market and our contractor clients. NASBP will keep you apprised of educational programs that may be developed to address these and other current topics.

The abilities of our NASBP staff are outstanding, and they are committed to doing whatever they can for our Association and the industry. Call or email them with a problem or concern and give them a chance to help you. Mark McCallum and the rest of our staff deserve to be commended for the outstanding job they are doing on our behalf. They are consistently “raising the bar” with their efforts on membership, government relations, and education.

We need to do our part. Let us start by attending the NASBP Washington Week in Washington DC, June 24-28. I will be there; I hope to see you there too!

Sincerely,

Carl E. Dohn, Jr.
NASBP President

Carl E. Dohn, Jr. is President of Dohn & Maher Associates in Palatine, IL. He can be reached at carldohn@dohn.com.