Insures the exact fulfillment of the obligations arising from the contract signed between the Insured and a public contracting authority.
When a Company is awarded a contract, it has to submit this type of bond to guarantee the respect of the obligations arising from the contract. The value of the bond equals to 10% of the value of the works awarded minus the mark down made with the bid. In case the awarding has been decided further to a mark down of the initial value of the contract higher than 10%, the bond value is increased of the same percentage points offered over 10%; where the mark down has been higher than 20%, the bond value is increased of 2% for each percentage point offered over 20%. The bond value is progressively reduced according to the amount of works certified. The reduction of the policy value is automatic upon submission to the Insurer of the certificate of accomplishment of a certain percentage of works. The policy will be effective until the final tests have been successfully certified or after 12 months from the assessment of the end of works.