This is an undertaking by Royal Exchange General Insurance Company Limited (Guarantor) that if another party (Contractor) fails to perform his obligation the guarantor will make good. Bonds are evidenced in writing, signed and sealed by the parties involved.
Two types of bond are common in Royal Exchange Insurance Co. Limited. They are:
Performance Bonds: This guarantees the performance of the job according to all
specifications and requirements as contained in the contract arrangement.
Advanced Payment Bond: This bond guarantees the principal that the advance payment made in respect of a contract will be reimbursed in case the construction work is not performed as agreed.