Page Categories: Bonds

Managing and facilitating bonds | Kerry London Limited
Monday 27th November 2023
How is a bond calculated?

Performance Bonds are normally 10% of the contract value. Retention Bonds are usually between 2.5 and 5% of the contract value, and Advance Payment Bonds are a fixed sum, depending on the advance payment value. The bond wording can stipulate that the amount reduces when certain milestones are achieved. For example, upon the issue of […]

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Managing and facilitating bonds | Kerry London Limited
Monday 27th November 2023
What information will my Surety Broker need?

Insolvency continues to dominate the news headlines, and the Building Cost Information Service (BCIS) data confirms this. Insolvencies rose 9.2% last year and 30.7% compared to 2019. As this rise continues, so does the demand for construction bonds, which are becoming a regular feature of the construction tender process. Kerry London’s Bonds team advises how […]

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Managing and facilitating bonds | Kerry London Limited
Monday 27th November 2023
How much does a bond cost?

The cost of a bond depends on the financial strength of the company applying for the bond. This is because security is provided to the surety via a counter-indemnity. The surety will analyse the financial information, and provide indicative terms, subject to the financial information meeting their underwriting criteria. Another factor that can affect the […]

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Managing and facilitating bonds | Kerry London Limited
Monday 27th November 2023
How long does a bond last?

The duration of a bond is agreed between Beneficiary and Contractor prior to the bond being issued. Different bonds are usually in place for different periods. A performance bond will typically be in place for between 1 and 3 years. A retention bond will be in place for between 1 and 2 years. An advance […]

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Managing and facilitating bonds | Kerry London Limited
Monday 27th November 2023
Can a bond be cancelled?

Unlike a general insurance product, a bond is a legal obligation that cannot be cancelled for any reason, other than its specified expiry provision having been achieved. This must be proven via the relevant certificate provided by the Beneficiary, or its representative, once the Contractor has fulfilled the contractual obligations. Bonds with a fixed expiry […]

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