Surety Bonds

Flexible access to capital.

A surety bond is essentially a promise or an undertaking by an insurer (the Surety) to pay to another party (the Obligee or Beneficiary) an agreed amount in the circumstances set out in the bond wording and in line with an underlying performance based contract.

Surety bonds are an unconditional and on-demand instrument providing an alternative to bank guarantees or retention monies.  They are widely accepted in the Australian and New Zealand markets by Federal, State and Local Governments, public and private enterprises.

The bond facility is unsecured with no tangible security or cash collateral required compared to the banks’ secured position. Surety bonds provide certainty around expansion and growth or acquisition targets and allow for greater flexibility as companies can leverage off their capital base, enhancing working capital and liquidity opportunities used and recognised in major trading countries worldwide.

Types of surety bonds

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    Contract performance bonds
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    Bid bonds (or tender bonds)
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    Advance payment bonds
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    Retention release bonds
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    Off-site material bonds
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    Maintenance/defects liability bonds
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    Workers Compensation bonds
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    Mining Rehabilitation bonds
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    Other bonds at the discretion of the Surety provider

How surety bonds work

A surety bond is a three-way obligation between:
  1. The Contractor, who has the primary responsibility to perform the obligation
  2. The Obligee or Beneficiary of the bond, and to whom the right of performance is owed
  3. The Surety, who has the responsibility to effectively secure, to the Obligee, obligations of the Contractor if the Contractor fails to perform

How we help you

We get to know you, your needs and the structure of your business. We identify where the key risks exist and where gaps in coverage may be. From there, we develop a robust risk management and insurance response to the specific nature of your business and seek the best available cover.

 

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