Bonding

Bonding

Ensuring completion of a project

What is Bonding?

Public and private customers can look for guarantees from you before and after a contract award. The objective is to save time and money if you fail to fulfil the contract. If it occurs, the customer is able to recover the costs it incurs from the provider of the bond.

Why should I use Surety Bonding?

Bonds are regularly provided by banks but there is a very efficient alternative to the traditional bank guarantee. This is from an insurance company (surety) and this avoids you being strained on your credit line by your bank, therefore giving you more headroom for financing and helping to increase your business.

How does it work ?

Types of Bonding

Bid Bond

Definition

 

A tool to guarantee the customer that you, in bidding for the contract, will be able to enter into if the bid is accepted, and to provide the required performance and payment bonds.

 

Who does it apply to?

 

Very common for companies operating in construction sector and manufacturing industry.

Advance payment bond

Definition

 

A tool which protects the buyer for loss of an advanced payment should the contracted goods or services not be supplied.

 

Who does it apply to?

 

Very common for companies operating in construction sector and manufacturing industry.

Performance bond

Definition

 

A tool to give security to the buyer that you’ll be able to perform your obligations as defined in the contract. This type of bond follows in sequence after a bid bond has been submitted and the bid is awarded.

 

Who does it apply to?

 

Very common for companies operating in construction sector and manufacturing industry.

Duty deferment bond

Definition

 

A guarantee in favour of Customs & Border Protection for the payment of import duties and taxes.

 

Who does it apply to?

 

Importers of products that attract tax or duty on entry to the country.

Retention bond

Definition

 

A guarantee issued to avoid retention payments. This tool states that in return for the customer not holding cash retentions, the bonding company undertakes to pay the customer if you fail to complete the work or remedy defects.

 

Who does it apply to?

 

Very common for companies operating in construction sector and manufacturing industry.

Partner References

  • Zurich
  • Tokyo Marine
  • RV
  • QBE
  • pingan
  • Munichre
  • PICC
  • Groupama
  • Euler
  • Equinox
  • credenco
  • cosec
  • Coface
  • Chubb
  • Cesce
  • Axa
  • Baez
  • Groupama
  • Atradius
  • AIG
  • EDC
  • Continental
  • Solunion
  • Sinosure
  • HKECIC
  • SACE
  • Nexi
  • Sompo
  • Sloglasie
  • Credit Guarantee
  • Lombard
  • Ksure
  • SGIC
  • ICIEC
  • Markel
  • Nexus
  • EximBank
  • Tokio Marine
  • Cathay