Construction insurance
Performance bond
Guaranteeing your client the proper performance of the contract.
The essentials
A performance bond assures the client that it can be compensated if the contractor does not perform the contract as agreed.
The wording of the bond is decisive: on first demand or accessory, duration, amount. We help you understand it before you accept it.
The situations concerned
- A public or private contract requiring a performance bond.
- A new client asking for security.
- A project of unusual size for the business.
How we support you
- Analysis of the proposed bond wording.
- Preparing and submitting the application to the guarantor.
- Follow-up until release.
Before deciding
Points to examine
- 01On-demand guarantee or not.
- 02Amount and duration.
- 03Conditions of release after handover.
How it works
How we move forward together
- Step 1
Understand the project
Type of works, parties involved, timetable and contracts: we start from the actual project.
- Step 2
Allocate the risks
Who insures what between the project owner, contractors and consultants? We clarify responsibilities.
- Step 3
Put in place
Covers and guarantees are placed before work starts, with checked documents.
- Step 4
Follow the site
Amendments, changes to the timetable or the amount: the arrangements follow the progress of the works.
- Step 5
Close
Handover, end of guarantees and retention of the relevant documents.
Frequently asked questions
Your questions
What is an “on first demand” guarantee?
The beneficiary can obtain payment without first having to prove the breach. This is more restrictive for the contractor and deserves particular attention.
Does the performance bond cover defects after handover?
These are often two separate guarantees. The wording specifies the period covered.
Can the wording be negotiated?
Sometimes. It is useful to examine it before signing the construction contract.
What happens if the bond is called?
The guarantor pays according to the terms of the guarantee, then seeks recourse against the contractor. Hence the importance of understanding the commitment properly.
Related services
Useful resources
Let’s talk about your business.
A first conversation to understand your situation, with no obligation. Call us or write to us.