The Siouxland Chapter of CFMA held its quarterly meeting today (9/16/15) at CJ Callway's in Sioux Falls.
We kicked things off with a quick business meeting including a briefing on the board's recent strategic planning session. There are many exciting things happening with the Siouxland chapter and I encourage you to check out the short slide deck we uploaded to get all of the details.
Then we got down to the business of surety. Michelle Randall, Assistant Vice President with the Surety Risk Solutions group at Zurich started at the beginning...the VERY beginning...and took us all the way through some contracts she has been involved with negotiating and some cases she has seen in the industry. Michelle stresses that the best contractors view their surety as a partner looking out for the contractor's best interest. After all, what is in the contractor's best interest is ultimately also in the best interest of the surety.
Michelle continued her presentation with a lesson on some of the contract clauses that contractors should pay close attention to. A lot of contractors will look at indemnification clauses and damage clauses and assume they are boilerplate, but that is a VERY dangerous proposition. One example she provided was a $600,000 glass contract that resulted in a $14.5 million award by an arbitrator for delay damages. How can that be? (To find out, check out Michelle's slide deck which has been uploaded to our chapter library.)
We closed the morning with a discussion of Subcontractor Default Insurance. The bottom line is that if you aren't subcontracting $50 million or more in a year, you will probably find that it isn't going to be worth it for your firm. For more details on features of subcontractor default insurance as well as a discussion of the differences between subcontractor default insurance and bonds, download the slide deck from the chapter library. (See a theme here?!)
Michelle's slide deck also includes information she was not able to cover because of time including specifics on South Dakota surety law and bond claims. Her passion for her work was evident as was her expertise on the subjects of surety and construction contracts. Thanks to Michelle Randall for presenting today and for sharing the slides so that we can examine the information more closely. If you have any questions on today's topic, go ahead and email Michelle at michelle.randall@zurichna.com.
A few quick reminders:
- There is still time to register for the Heartland Conference, September 24 & 25 in Council Bluffs. A couple of members have mentioned that they had planned to attend, but will now be unable, so their rooms are available if you want to take over their reservations.
- Our December meeting is scheduled for Thursday, December 3. Our speakers will be economist Anirban Basu and Joseph Mahon an economist and analyst with the Federal Reserve Bank of Minneapolis. Be looking for information in October and please bring guests! This is bound to be a great meeting!
- The Siouxland Chapter will be volunteering with "Lunch is Served" an organization that prepares and delivers meals to day laborers in Sioux Falls on Tuesday, January 19, 2016. We need 15 individuals and will send a registration invite as the date draws closer.