Bonds & Guarantees in the Construction Sector - The Key Issues

Introduction

Between Covid 19, Brexit and the ever-increasing costs of labour and supplies, the risk of a contractor failing to perform its obligations under a contract or becoming insolvent has never been greater.

While employers should endeavour to obtain suitable security for such events, issues such as the availability and cost of bonds, the covenant of any guarantor and the difficulties in claiming under a bond or guarantee cause many employers to wonder if such securities are worth the paper they are written on.

This webinar will look at performance bonds and guarantees in the construction sector, discussing the challenges currently faced in the market in obtaining such securities, and offering some alternative security options for an employer.

What You Will Learn

This webinar will cover the following:

• Why employers seek performance bonds and guarantees
• Key differences between performance bonds and guarantees
• Issues faced when seeking performance security:
• ‘On default’ rather than ‘on demand’
• Costs and availability of bonds
• A warrantor’s covenant
• Claiming against a bond or guarantee
• Alternatives for an employer to obtaining a bond or guarantee

This webinar was recorded on 9th May 2022