Bond Insurance Policy

A Bond insurance policy protects the UK exporter against loss, where a UK bank issues a bond on their behalf to an overseas buyer, or counter-guarantee to a bank in the buyer’s country, as a condition of an export contract.

UK Export Finance will consider cover for all types of bonds for export contracts, except tender or bid bonds.  The main types of bonds that UK Export Finance are asked to cover are advance payment bonds and performance bonds.  Cover is also considered for reducing bonds, which are bonds under which the amount payable reduces over time or as goods or services are delivered.

The exporter is given 100% cover, there is no fee for the application and the premium payable for UK Export Finance's cover is determined on a case by case basis.

Apply

Before You Start

The Bond Insurance Policy is provided by UK Export Finance.

A Bond insurance policy protects the UK exporter against loss, where a UK bank issues a bond on their behalf to an overseas buyer, or counter-guarantee to a bank in the buyer’s country, as a condition of an export contract.

Restrictions

The bond must not be a tender or bid bond, or a bond given for contract payments that are aid funded by the UK Government.

What You Need To Know

Key Criteria

The exporter, the buyer and the bond must meet the following criteria:

  • 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 a tender or bid bond or a bond given for contract payments that are aid funded by the UK Government.

Match Funding

The exporter is given 100% cover.

Eligible Expenditure

The exporter is protected against the risks of:

  • unfair calls made on the bond by the buyer or on any related counter-guarantee by the local bank; and
  • fair calls under the bond or any related counter-guarantee, which are caused by certain political events such as government actions (including the cancellation or non renewal of export licences), war, hostilities, civil disturbances and similar events outside the UK.

How To Apply

Deadline(s):    

Applications should be made prior to the start of the cover period required, however, the scheme has no set deadlines.

Frequency: Rolling programme.

Useful information:

Application forms are available to download from the UK Export Finance website.

When considering applications, underwriters will look at each case on its own merits.