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The need to provide guarantees to secure performance and other security requirements can be a major obstacle for contractors tendering for projects. In many cases, they have pledged all available security to a financial institution and may have reached capacity within its agreed facility limit. As surety bonds are generally unsecured they can enhance your working capital and liquidity position without the need to provide tangible security.
The advantages of a surety bond facility can be easily demonstrated using the example of a contractor with a net worth of $3 million winning a contract for $30 million and being required to lodge a bond for $3 million (10% of the contract value). Traditionally, a financial institution would require the contractor to either place at least $3 million on deposit or effect a mortgage/debenture over assets of similar value. As surety bonds are generally unsecured, the contractors’ assets remain unencumbered, and working capital is released to fund future contracts.
Our bonds are widely accepted by Federal, State, and Local governments as well as large publicly traded companies and private enterprises.
A Deed of Indemnity and Guarantee is our recourse document in the unlikely event of a claim. The security involved will depend on the individual circumstances of your company.
Contact us to talk about how we can meet your needs; email: suretybond@hpafsecuritisationno1plc.com
Our analysts look for specific qualities:
The only cost involved is a fee for the establishment of the Deed of Indemnity and Guarantee.
Yes. The cost is payable upfront before we issue the bond.
It depends on the specifics of your application, including the bond value, the bond rate, and the duration of the bond.
As long as the project tenure. We are able to gain special acceptance from our reinsurers to go issue bonds for an indefinite amount of time.
Once your facility has been established a bond can be issued and delivered within 24-48 hours of receipt of your application.
We’ll pay brokerage, however the amount will depend on the volume of business and level of involvement of your broker. Should we deal with you directly then no brokerage is payable.