Advantage Insurance looks at the role of Performance Bonds in the construction industry in 2019
PBC Today readers will no doubt have noticed that the use of performance bonds in the UK construction industry has become more widespread in recent months.
Following the high-profile collapse of Carillion last year (which triggered a 20% spike in the number of UK building firms becoming insolvent, as reported in the Guardian), many are turning to performance bonds to mitigate risk.
The role of Performance Bonds in construction
Performance bonds enable the client to recover costs if a contractor they’re working with on a project fails to fulfil their contractual obligations. In the past, they were primarily issued by banks, but these days clients are increasingly likely to call upon sector-specific insurance specialists like Advantage for insurance bonds.
There are a range of reasons why our clients choose performance bonds, including providing peace of mind when working with a new contractor for the first time or mitigating risk when embarking upon larger projects. Ultimately, they are designed to protect clients if a contractor fails to meet their contractual obligations.
The types of bond we specialise in at Advantage include performance bonds and road and sewer bonds (offering a cost-effective way of covering your sewer and road bonds insurance). If you’d like to discuss performance or road and sewer bonds, we’d be very happy to help.
Advantage Insurance is a leading provider of structural defects insurance in the UK, working with leading developers and insurers to provide our clients with peace of mind – whether they’re working on a £50m flagship development or an individual self-build. Our case studies page gives an idea of the broad range of projects we’ve worked on.
Tel. 0845 900 3969 or email: firstname.lastname@example.org