Surety insurance: the guarantees you are asked for, without using up your bank lines
Public bodies, clients and authorities require guarantees to bid, receive advance payments, perform contracts or carry out certain activities. Surety insurance provides them with the same validity as a bank guarantee, without tying up cash or using your credit lines.
An insurer that guarantees you will do what you have committed to
Three parties are involved in surety insurance: your company, which takes on an obligation; the beneficiary, which requires a guarantee that it will be met; and the insurer, which issues that guarantee.
If your company defaults, the insurer pays the beneficiary up to the guaranteed amount and can then recover what it paid from your company. So it is not insurance covering your own mistakes, but an alternative to a bank guarantee that backs your solvency with third parties.
Spanish public bodies accept surety insurance as a guarantee in public procurement, and it is also common in contracts between companies.
In a nutshell
It works like a bank guarantee, but is issued by an insurer. Your bank keeps intact the lines you need to finance the business.
More financial capacity to grow
Doesn't use your bank lines
Your bank limits remain available to finance working capital and investment.
Doesn't tie up cash
No need to deposit cash or pledge balances as counter-guarantee.
Diversifies your guarantees
Adds the capacity of several insurers to that of your banks, which is key if you tender frequently.
Speed
Once the facility is approved, each guarantee is issued quickly, without repeating the analysis.
The most common guarantees
Public procurement
Bid bonds and performance bonds to tender for and perform public contracts.
Contracts between companies
Advance payment, performance and maintenance bonds for private clients.
Off-plan home deposits
The legal guarantee developers must give buyers who pay before handover.
See deposit guaranteesPlanning and licences
Guarantees for local councils for urban development works, reinstatement of services or waste management.
Customs and excise duties
Guarantees for the Spanish Tax Agency for imports, bonded warehouses and deferrals.
Regulated activities
The guarantees regulations require of certain sectors to be allowed to operate.
A surety facility you use when you need it
The insurer assesses your company's solvency once and grants a facility with a maximum limit, from which individual guarantees are issued. We present your company to several insurers to obtain the greatest capacity on the best terms.
- Analysis. We gather your financial statements and information on your business and present them to the market.
- Surety facility. Insurers set the overall limit, premium and terms; we help you choose.
- Issue. Whenever you need a guarantee, we request it with the beneficiary and obligation details.
- Monitoring. We track expiries and releases to free up capacity in the facility.
Daniel Santana
Client Manager · Trade Credit and Surety · Creditizia, Grupo Trebia
He supports you from the initial analysis of your company to the issue of each guarantee, liaising directly with the surety insurers.
What clients usually ask us about surety insurance
Is it as valid as a bank guarantee?
Yes, where the regulations or the contract allow it, as in public procurement. We always check that the beneficiary accepts surety insurance before issuing it.
If I default, does the insurer just pay?
No. The insurer pays the beneficiary and can then recover what it paid from your company. That is why it assesses your solvency before granting the facility.
What does the insurer need to grant me a facility?
Usually the annual accounts for recent years, information on the business and, depending on the case, details of the guarantees you expect to need.
Can I combine it with bank guarantees?
Yes, and that is the most common approach: surety insurance increases the company's total guarantee capacity without necessarily replacing the banks.
How much does it cost?
You pay a premium that depends on the company's solvency, the type of guarantee, the amount and the term. We present comparative proposals from several insurers.
We help you obtain your surety facility
Tell us who you are and what guarantees you need. Our surety specialist will contact you to analyse your company and present it to insurers.
- Comparison across more than 40 insurers
- A review of your current policy, if you have one
- A single point of contact who also supports you with claims
Request your review
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