Surety 007 – Promoting Surety Bonds through Technology

Benefits of Surety Bonds

• No Collateral
• Better Liquidity
• Line of Credit Unblocked
• Cheaper

Know more about Surety Bonds in INDIA from Surety Seven

Surety Bond

Surety Bond (Insurance) provides a guarantee to The Obligee (project awarding authority) against non-compliance of contract or non-completion of project by The Principal (the contractor or construction company).

Types of surety Bonds

1. Performance Bond
2. Payment Bond
3. Maintenance Bond
4. Bid Bond

Contract Bonds

Used in the construction industry to provide a guarantee of performance. They also find uses in import sector and other commercial dealings where a guarantee needs to given against a contract, usually of high value.

Judicial Bonds

Bail Bond & Appeal Bond are used in judicial matters by the parties involved in a legal judicial matter

Commercial Bonds

These bonds include license and permit bonds that may be required for various purposes where a license is to be obtained to carry out an activity. It can be, therefore, stated that Commercial Bonds are customizable as per requirements of The Obligee & The Principal.

What is covered by Surety Bonds?

Surety Bonds in India provide an unconditional coverage to The Obligee (project awarding authority) against losses by The Principal (contractor or construction company). IRDAI (Insurance Regulatory & Development Authority of India) has issued guidelines on Insurance Surety Bonds.

Additionally, Surety Bonds are expected to provide a boost to the construction and infrastructure industry in India as it provides enhanced liquidity to the contractors. This cash strapped contractors are expected to utilize this new found liquidity to lower contract costs and take up more projects.

Frequently Asked Questions