What is the loss run report in surety bonding?

The loss run report is specifically a document that provides detailed insight into a contractor's claims history. It outlines the claims that have been filed against a contractor, including the status of those claims, amounts paid, and any outstanding reserves. This report is critical for surety bond underwriters as it helps assess the risk associated with bonding that contractor. By analyzing the loss run report, underwriters can gauge the contractor's past performance and the likelihood of future claims, which is essential in determining the contractor’s eligibility for bonding and the rates that may be applied.

This focus on claims history distinguishes the loss run report from other types of reports. For instance, a report on financial stability would primarily address the contractor's fiscal health rather than their claims performance. Similarly, a record of previous contracts would involve the details of contracts executed but not specifically how they had performed in relation to claims. Lastly, while bond rates are an important consideration, they do not capture the detailed history of claims that the loss run report provides. Therefore, the correct interpretation of the loss run report as detailing a contractor's claims history is essential for understanding its role in the surety bonding process.