Union Minister for Road Transport and Highways Nitin Gadkari has launched one of India’s first-ever Surety Bond Insurance products from Bajaj Allianz.
About Surety Bond Insurance
- The Surety Bond Insurance product will cater to the requirements of a diversified group of contractors.
- The Surety Bond Insurance is a risk transfer tool for the Principal and shields the Principal from the losses that may arise in case the contractor fails to perform their contractual obligation.
- The Surety Bond product gives the principal a contract of guarantee that contractual terms and other business deals will be concluded in accordance with the mutually agreed terms.
- In case the contractor doesn’t fulfil the contractual terms, the Principal can raise a claim on the surety bond and recover the losses they have incurred.
- Unlike a bank guarantee, the Surety Bond Insurance does not require large collateral from the contractor thus freeing up significant funds for the contractor, which they can utilize for the growth of the business.
- The Surety Bond product will also help in reducing the contractors’ debts to a large extent thus addressing their financial worries.
