Otto Broker and CertAsig presents new solutions for bond instruments
28 October 2011
On 27th October, Otto Broker and CertAsig organized an event attended by companies with public procurement activities. The main focus was the bond insurance. The event took place at the British Ambassador’s residence in Bucharest, Romania.
Otto Broker and CertAsig representatives presented to their guests the advantages of opting for a Bond insurance as an alternative to guarantee letters issued by banks, so as to maintain available liquidity without blocking working capital. The discussions were focussed on the practical aspects of bond insurance instruments and their advantages, taking in consideration that banks loans are not very accessible.
In addition to available liquidity and assets of the company, opting for an insurance service may represent a long-term partnership. This type of insurances is mainly designed for companies with contractual relationships with public institutes, but also between private companies.
The main Bond insurance policies are: Bid Bond insurance (valid between 90 days and 120 days), Advance Payment Bond insurance (valid under 1 year), Performance Bond insurance (valid for up to 6 years) and Maintenance Bond insurance (valid for up to6 years).
CertAsig and Otto Broker representatives explained the working procedure used by an insurance company in underwriting these types of insurance as well as providing clarification and solutions for different situations confronting contracting authorities.
James Grindley, CEO of CertAsig stated: „ Today we had a very useful and interactive session with potential clients and Otto Broker to discuss how bond insurance really works. As a new product on the Romanian market, we thought it appropriate to clarify certain commercial advantages to bond insurance buyers. Our products are a cost -effective solution for many companies. For example a CertAsig bond insurance policy enables the insured party to qualify and participate in local tenders. At the same time, it means the insured company does not need to ‘tie up’ cash which can be employed elsewhere to develop and support their business.”