SBI General Insurance unveils Surety Bond Insurance which will boost India’s infrastructure development
Mumbai, 24 May 2023: SBI General Insurance, one of India’s leading general insurers announced the launch of the ‘SBI General Surety Bond Bima (Conditional & Un-Conditional)’ insurance product. The product is designed to provide protection against breach of terms & conditions by the contractors either during the bidding stage or during the performance stage of a project.
The Surety Insurance product consists of a wide range of bonds, such as Bid bonds, Advance Payment bond, Performance bonds, and Retention Money bond. Additionally, there are two variants available in the product i.e. Conditional & Un-Conditional. In a Conditional bond, a specified sum is paid to the beneficiary upon claim when specific conditions are met, while an Unconditional bond allows the beneficiary to claim the money almost without any conditions.
This product was developed in response to the government’s vision to upscale infrastructure development. The Surety insurance provides an assurance to the project owner in the form of a Surety Bond that the contractor would complete the project as per the agreed terms and conditions. The product is designed to insure the contractors for non-performance and financial exposures in case of contractual default. It helps in ensuring the contractors fulfil their obligations in the projects awarded, thereby providing financial security to the beneficiary. By providing project owners with peace of mind on individual projects, surety bonds help to promote successful and efficient project outcomes.
Anand Pejawar, Whole-Time Director, SBI General Insurance said, “The infrastructure sector has witnessed a remarkable growth in recent years, making a substantial contribution to the overall growth in economic activity in India. At SBI General, we are at the forefront of providing innovative risk solutions to our customers. Through SBI General Surety Bond Bima, we are confident that this product will serve as an effective tool for the infrastructure sector. Surety bonds offer financial security, risk mitigation, and peace of mind for all the parties involved in a contractual agreement. They foster trust, stability, and efficient project completion, ultimately contributing to the overall development and prosperity of the nation.”