In the past
several years’ the insurance market has developed an
alternative to surety bonds that enable prime contractors
and / or project owners to manage the financial risk
associated with the default in performance of subcontractors
and suppliers. The product is known generically as
subcontractor default insurance.
It creates an exceptional risk/reward opportunity for the
insured while providing a cost-effective and efficient
alternative to their traditional reliance on surety bonds
from subcontractors and suppliers. Instead, an insurance
policy is purchased which provides for claims and damages
resulting from the default in performance of a subcontractor
or supplier. |
 |
The policy is designed as a large deductible, finite-risk
insurance plan that provides the insured with security
against catastrophic losses while providing effective
control over the funding and administration of the claim and
cost recovery process.
For the correctly matched insured this product can be
significantly less expensive than traditional surety bonds
while providing considerable cash flow and claims handling
advantages.
Let our experts evaluate whether this or other alternatives
may prove more effective for your needs. |
