In guarantee insurance, you get a guarantee from an insurance company instead of a bank. This frees up the bank's guarantee limit for your company's growth investments, for example.
Guarantee insurance is most commonly used in the construction industry and in connection with the manufacture of investment goods. Guarantee insurance is intended for situations where, for example, the terms of the contract require collateral or guarantees.
Guarantee insurance is a good alternative to bank guarantees. We help arrange guarantee limits for both domestic and international markets. We can also manage the guarantee limit to ensure the best terms for bidding.
When can the guarantee insurance be used?
First, you should make sure in the text of the agreement that the beneficiary does not specifically require a bank guarantee. Already in the negotiations, it is good to ensure that the guarantee insurance becomes collateral.
Replacing a bank guarantee with a guarantee insurance frees your bank from the bank limit for other better purposes, such as growth investments.
Guarantee insurance can also be used in some cases to replace letters of credit. The pricing of insurance companies is currently very competitive, and insurers also do not require counter-guarantees.
Issuance of guarantee insurance
Guarantee insurers generally operate in the same way as banks. They grant their client a guarantee limit from which individual guarantees can be written quickly and flexibly.
The granting of a guarantee limit is based on an analysis of the company's financial position and future prospects. Guarantee needs also have an impact on pricing.
The most typical guarantees issued by insurance companies are
- labor and warranty guarantees
- RS guarantees (during construction, after construction)
- delivery guarantees
- advance payment guarantees
- payment guarantees
- customs guarantees
- various permit guarantees (eg environmental / land use guarantees).