What is Surety?
A guarantee given by a Surety Company to a Beneficiary, that the contractual obligations of the Principal will be fulfilled. Surety provides financial protection for a Beneficiary against loss due to the inability of the Principal to complete a contract.
The use of Surety has expanded massively over recent years. At the start of the Covid-19 Pandemic in 2020; in the initial weeks of lockdown, we witnessed Surety providers increasing the level of financial due diligence required across the board though continued to issue Bonds. As the impact of Covid-19 settles, the need for high level financial information required by the Surety (Bondsman) unfortunately continues as the global economy feels the impact of the war in the Ukraine.
The ability to secure capacity in the Surety market at this time is crucial to the Contractor to secure and have Bonds issued in good time to meet their contractual obligations.
We have also seen the acceptance of Bond Wordings by the Sureties tighten, the pre-vetting of proposed Bond wording within a contract at the tender stage is crucial to the Contractor fulfilling their obligations and negotiating the best possible terms to protect the business.
Despite continued economic turbulence in the Global market, Sureties continue to issue Bonds and are not currently applying rate increases across the board, each application is based on the Contractors financial strength and bond wording. Our expertise within the Surety market and accessing capacity has never been more important; Attis Surety Solutions can assist and support any Contractor who maybe struggling to manoeuvre and manage capacity in the Surety Market.