THREE PARTY AGREEMENT, that ensures the Principal (contractor) fulfills its obligations to the obligee (Project Owner). If the Principal fails, the surety (Insurer) pays the claim. It acts as an alternative to BG, bank guarantee. It improves liquidity and working capital.
Types: BID BONDS, PERFORMANCE BONDS, ADVANCE PAYMENT BONDS, RETENTION MONEY BONDS, MAINTENANCE /WARRANTY BOND, CUSTOMS BONDS AND OTHER CONTRACT BONDS.
BENEFITS: No blocking of bank limits, Better cash flow & liquidity, Improved working capital, Higher bidding capacity, Faster project execution, preserve banking relationship, competitive advantage.
Underwriting Parameters: Financial Strength, Working Capital and Net worth, Banking Behaviour, Credit rating, Project experience and track record, Order book and future pipeline, Management Quality, Technical capability, Project risk assessement, Litigation and arbitration, Crime History and Performance, Contract terms and conditions, Indemnity support.
Claim- Principal Default…..Notice by Obligee….Investigation by Surety…..Surety Assessment….Claim Settlement….Recovery from Principal…..
Widely used for Infrastructure Projects, Power, OIl and Gas, EPC projects Government Departments, Reeal Estat and commercial projects, Manufacturing and Industrial projects, Supply Servicee and Maintenance Contracts, Custom and Statutory Obligations.
Our Expertise- Expert guidance as Banker, INsurer and Broker. Quick Turnaround time, Minimal Documentation Hassle, , Competitive premium rates, Strong Insurer contact, Pan India Support.
Some time collateral is required.
