Configurator — Free Risk AuditA guarantee from an insurer doesn't count against your credit line.
Bonding — surety insurance — replaces bank guarantees for public tenders, construction contracts and deliveries of investment assets. As an independent intermediary we run a free needs audit and compare insurer offers on the market.
What bonding is and what it's for
Bonding, or surety insurance, is a product where an insurer (a surety) issues a guarantee document instead of a bank. The contracting authority or investor gets the same assurance as with a bank guarantee — but the supplier doesn't have to tie up a credit line or put up cash collateral.
Assurance for the contracting authority
The contracting authority needs assurance that a bidder won't withdraw their offer or will actually complete the awarded contract.
Assurance for the investor
The investor wants cover in case the contractor fails to complete the work as agreed, or defects appear after handover.
Assurance for the buyer
A buyer paying an advance upfront wants assurance the money will be returned if the delivery doesn't happen.
The most common types of guarantees
The specific type of guarantee is usually set by the tender documentation or contract terms — in practice you'll most often encounter these four.
Bid bond guarantee
Covers the risk that a bidder withdraws their tender or refuses to sign the contract.
Performance guarantee
Covers the risk that the contractor fails to complete the work in line with the contract or within the agreed deadline.
Advance payment guarantee
Covers an advance payment made to the supplier upfront, in case the delivery doesn't happen.
Warranty guarantee
Covers the warranty period after handover — assurance that the supplier will actually fix any defects.
Bonding, or a bank guarantee?
For the contracting authority it usually doesn't matter who issued the guarantee — both carry the same legal weight. The difference is what arranging it costs your company.
| Bank guarantee | Bonding (insurer) | |
|---|---|---|
| Impact on credit line | Ties up part of your bank credit line | Credit line stays free |
| Collateral | Often requires collateral or a blocked deposit | Usually based on the company's creditworthiness, no collateral |
| Speed of issue | Depends on the bank's approval process | Often faster, outside bank approval processes |
| Cost to client | Fee to the bank for issuing and maintaining the guarantee | Premium — no extra cost to the client |
The same approach as with trade credit insurance
With bonding too, we first find out what you actually need, and only then look for a solution — not the other way round.
Guarantee needs analysis
We review your current and planned contracts and tell you what types and amounts of guarantees you'll need.
Indicative price estimate
Based on the type and amount of the guarantee, we give you a rough cost estimate within a few days.
Recommended solution
Based on the analysis, we recommend the solution that best fits the type and value of your contract.
The analysis results are yours to keep, even if you decide to stick with a bank guarantee.
Get a guarantee quoteWhen bonding makes sense
It's most valuable for companies that regularly have to post guarantees to contracting authorities or investors.
Construction and engineering firms bidding for public tenders.
Suppliers of investment assets and technology equipment.
Companies that need to free up their bank credit line for working capital.
Companies regularly issuing warranty guarantees after handing over a project.
Subcontractors on large construction projects.
Companies expanding into public tenders abroad.
How the audit works
No-obligation inquiry
You tell us the type and amount of guarantee you need.
Creditworthiness analysis
We review the company's financial position and track record of completed contracts.
Inquiry with insurers
We approach insurers that offer bonding on the market.
Recommended solution
Based on the analysis, we recommend the solution that fits your situation.
Frequently asked questions
What's the difference between bonding and a bank guarantee?
The main difference is that a bank guarantee ties up part of your credit line at the bank, while an insurer's guarantee leaves it free for working capital. For the contracting authority it doesn't matter who issued the guarantee — both carry the same legal weight.
What types of guarantees do insurers issue?
The most common are bid bonds, performance bonds, advance payment bonds and warranty bonds. The specific type is usually set by the tender documentation or contract.
Do I need the same collateral as with a bank?
Usually not to the same extent — the insurer relies mainly on the company's creditworthiness and track record of completed contracts, not on a requirement for collateral or a blocked deposit.
How quickly can a guarantee be issued?
It depends on the type and amount. For standard guarantees it's typically a matter of days to a few weeks from when documents are submitted.
How much do the intermediary's services cost?
Same as with trade credit insurance — the intermediary's fee is normally paid by the insurer out of the premium, so clients typically pay nothing extra.
No-obligation guarantee inquiry
Send us a few basic details about the contract and we'll get back to you with next steps.
Credigo
Surety (bonding) insurance configurator — free risk audit