Products · Surety Bonds
We build trust.
Do you want to structure and optimize your guarantee management?
Bank guarantees burden your credit line.
Many companies know no alternative to the bank guarantee. Yet there are cheaper, more flexible options. We know the subtle differences between avals, sureties, and guarantees.
Which guarantees we mediate.
Contract-performance bond
Secures contract-compliant delivery – standard in construction.
Warranty bond
Replaces the retention amount – full contract value paid immediately.
Advance-payment bond
Secures advances – clients pay without loss of trust.
Surety insurance
Often cheaper than a bank guarantee. Frees up your bank credit lines entirely.
What our clients say.
“We've restructured our surety bonds significantly more efficiently. Our bank lines are free again for operational projects.”
Service Packsystems GmbH, construction company
“Ms. Renz has found solutions for us that fit our situation perfectly. Structured, personal, resilient. Even in everyday life, we feel very well taken care of and are glad to have a neutral point of contact for various topics related to guarantees.”
Ackermann GmbH, plant engineering
Frequently asked questions
Surety insurance is the precise term for a guarantee provided through an insurer rather than a bank. A surety bond or surety insurance is a safeguard in favour of a principal in case a company fails to meet contractual obligations – e.g. in construction, advance payments, or warranty claims. Instead of a bank guarantee, here an insurer provides the security, which preserves both liquidity and the company's credit line.
1. Contract with insurer: the company enters into a surety-insurance contract with an insurer – with a defined surety framework. 2. Surety certificate is issued: for each individual project the insurer issues a surety certificate on request. 3. Beneficiary receives security: the beneficiary receives the certificate as proof of security – without the company having to tie up its own funds. 4. Premium instead of capital commitment: typically 0.5% to 4% of the surety amount, depending on credit standing, industry, and term.
The biggest benefit of surety insurance is that it spares your liquidity and your bank credit line. Instead of backing a guarantee against your bank account, the insurer provides the security – creating financial headroom for other investments. In addition: no impact on your current account, quick processing, and often lower costs compared with a bank guarantee.
Surety insurance suits companies that regularly have to provide security to principals – e.g. in construction, mechanical engineering, skilled trades, or plant construction. Particular beneficiaries: mid-sized companies with frequent surety requirements, growth-oriented businesses that want to preserve their bank credit line, and companies with seasonal peaks. Start-ups and young firms also use surety insurance to protect liquidity.
If your principal demands security, a contract-performance bond is recommended. In principle, it secures the principal against the insolvency of the contractor. With a contract-performance bond you not only secure your principal's claims to timely and complete delivery; you also secure your own payment claim against the principal for the contract amount.
Three parties are involved: you as contractor or manufacturer, your principal or customer, and the surety. The aim of this bond is to safeguard an advance payment already made by your principal via a surety, in case you cannot deliver the contract, or only partially. An advance-payment or prepayment bond gives your customer the certainty that their prepayment is not lost. At the same time, it secures your risk of having to repay the prepayment.
A warranty bond – also called a defects bond or warranty guarantee – is used in certain cases to secure credit. The issuing guarantor assumes liability for your warranty obligations arising from material or legal defects in the purchased item. With a warranty bond, you minimise the warranty risk for your customer in case you lack the financial means to cover the remediation obligation.
"Aval" (Italian avallo = surety) is a generic term for guarantees or bonds usually issued by banks on behalf of a customer. An aval is a bank-backed security instrument in which a credit institution – usually a bank – vouches to a third party for a customer's obligations – without actual cash payout. Technically, an aval is a contingent liability. It does not directly burden liquidity, but the bank extends a liability undertaking for the customer.
The term depends on the contract. An open-ended term is however common. Many bonds – e.g. rent deposits, contract-performance, or warranty bonds – are open-ended and run until the beneficiary officially releases the bond. In some cases, a fixed term is agreed. Important: the beneficiary decides when the bond ends – not the policyholder.
To conclude surety insurance, your company must generally be economically stable. Insurers check in particular: credit standing and capitalisation (e.g. via BWA or annual accounts), legal form (usually GmbH, AG, or equivalent), and a plausible surety volume (often from about €10,000). Young companies can also obtain surety insurance – often on individual terms. The better the credit standing, the more flexible the terms.
A guarantee is an independent obligation, separate from the main contractual relationship. With bonds and avals, so-called accessoriness applies – i.e. they are valid only if the main contract is valid. If that accessoriness is absent, the instrument is legally a guarantee.
Commercial leases are ongoing obligations where your payment duty as a commercial tenant continues over a long period. With a rent bond, you secure the risk for both parties: your landlord's rental-default risk and your own credit risk as an entrepreneur.
An aval is frequently used as: a rental aval (instead of a cash deposit), a contract-performance aval, or a bidding- or guarantee-bond in the public tender context.
We see ourselves as bridge builders between partners.
We advise you with experience and expertise.