Commercial Bonds

The purpose of the submission bond is to guarantee the good faith of the contractor during the tender process. This bond stipulates that, if the contractor is chosen, he will conclude a contract within the deadlines provided for in the call for tenders with the client. This bond actually constitutes a selection instrument.

The letter of intent is usually filed with the bid bond and stipulates that the surety undertakes, if the contractor signs a contract with the client, to issue performance and payment bonds for labor and materials, if required by the latter.

Allows the client to be guaranteed execution of the contract, in accordance with its provisions. Therefore, we understand that, if the provisions are not respected by the contractor, the client may request the intervention of the surety, by virtue of this bond.

This bond protects the contractor's suppliers and subcontractors in the event of the contractor's failure to pay for the services they have rendered. If the Contractor does not make payments to its suppliers and/or subcontractors, the latter will have recourse to the surety for their payment, under this bond.

This type of bond is usually provided in exchange for the release of the contractual holdback, and guarantees the owner that the contractor will correct any defect, omission or faulty workmanship, for the warranty period, starting from the provisional or final acceptance of the work. If the contractor does not correct the defects during this guarantee period, the client may request the intervention of the surety, under this guarantee.

The Guarantors have minimum subscription standards in order to open a bond file and carry out punctual financial monitoring with the bonded entrepreneurs. In this sense, in the eyes of a client, the support of a guarantee towards a contractor offers certainty as to the financial health of the latter.

When you provide a bond as a guarantee to your client, no amount has to be kept by your financial institution or be given directly to the client, as is the case in particular in using a certified check or bank letter of credit.

The bank letter of credit or certified check which can also often be used in the context of tenders can be cashed on request by the client. In opposition, a surety will only take up the cause in the context of a request for intervention in cases where the contractor is truly in default or is in particular incapable of carrying out a project.

The majority of sureties have an in-house litigation department which offers support to its clients in the event of a dispute with a client.