You are a surety underwriter with Summit Surety and therefore responsible for assessing applications to decide who is bond-worthy. ABC Contracting has applied for a bid bond and a performance bond. They require these bonds in order to submit a bid for a large project.

1. What criteria will you use to determine whether or not to issue these bonds to ABC Contracting?
2. If you determine that ABC Contracting is in the high-risk category, is your only option to deny the application? Remember that Summit Surety is a business and needs to make a profit in order to be successful.