Bond Insurance Policy
Find out about our Bond Insurance Policy: its benefits, eligibility criteria and how to apply.
As a condition of some export contracts, a UK bank may be required to issue a bond on behalf of a UK exporter to an overseas buyer. The bank may also issue a counter-guarantee to a bank in the buyer’s country.
Our Bond Insurance Policy protects UK exporters against demands for payment under a bond or a counter-guarantee that is either unfair or caused by political events.
Benefits
Exporters taking out a bond insurance policy receive:
- up to 100% cover
- protection against losses suffered because of unfair calls on the bond or counter-guarantee
- protection against losses suffered because of fair calls caused by certain political events
Eligibility criteria
The transaction must satisfy UKEF’s eligibility criteria, which includes, among others, the requirements that:
- the exporter must be carrying on business in the UK
- the buyer must be in a country outside the UK
- the bond must not be given for contract payments that are aid-funded by the UK government
All transactions supported by UKEF must satisfy:
- our foreign content policy
- our anti-bribery and corruption and environmental, social and human rights due diligence processes
The transaction may not be supported if there are sanctions imposed on the country of the overseas buyer.
The main types of bonds we are asked to cover are advance payment bonds and performance bonds. We can also consider providing cover for reducing bonds, which are bonds under which the amount payable reduces over time or as goods or services are delivered.
Cost
The premium payable for our cover is determined on a case by case basis.
How to apply
To find out more about our Bond Insurance Policy or to discuss eligibility for our support, contact our customer services team. Contact customer.service@ukexportfinance.gov.uk or call +44 (0)20 7271 8010.
Our proposal form and product documentation are also available if you’re ready to submit a proposal.
Proposal form and product documentation
Specimen policies to assess whether our bond insurance policy is suitable for the contract.
Submit a proposal.
More information
- Read our guide for applicants on business processes and factors, to find out how we make decisions on applications
- Read our position on Financial Crime Compliance
Last updated 21 December 2022 + show all updates
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Update to eligibility criteria
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Change to Security of Information Arrangements
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First published.