Helvetia’s surety insurance takes over joint and several guarantees and warranties given by companies to third parties. This gives companies financial room for manoeuvre and enables them to win the confidence of new customers.
A surety insurance policy covers the risk of bankruptcy on the part of the policyholder. This always involves a three-way transaction between:
The beneficiary requires the policyholder to provide security in the form of a surety or guarantee. Otherwise it may withhold payments or services. The insurance company stands surety for the policyholder.
The surety policy is suitable for companies providing security in the form of a surety or guarantee in order to receive payments or services. Helvetia offers various sureties and guarantees depending on the needs of the policyholder.
The policyholder pays the premium. In the case of open-ended contracts, the policyholder pays the premium annually in advance. In the case of a time-limited surety or guarantee, the policyholder pays in advance for the full duration.
Prepayments for deliveries and services still to be provided are secured before the start of construction or during construction. This provides the client with the guarantee that he will be reimbursed for the part of the work that is not yet completed.
Example: In order to purchase building materials, the construction company issues an invoice on account for CHF 10,000. The client pays the invoice, but demands an advance payment guarantee as security for his payment. Helvetia stands surety for the construction company and issues a surety bond in favour of the client.
Before the start of construction or during construction, security is provided for the punctual completion of the order. This covers additional costs incurred by the client should the construction company be unable to complete the work in accordance with the contract.
Example: The construction company has received an order worth CHF 50,000 from the client. However, the client requires a guarantee of CHF 12,000 that the works will be carried out in accordance with the contract and on schedule. Helvetia issues a surety bond in favour of the client.
Once the construction work has been completed, surety is provided for the remedying of any hidden defects. The client receives the assurance that such defects will be remedied within the warranty period.
Example: The construction company has prepared the final invoice for the total contract of CHF 50,000. Before paying the invoice, the client requires security guaranteeing reimbursement for any defects occurring within the warranty period. Helvetia issues a surety bond with a guaranteed amount of CHF 5,000 in favour of the client.
In the event of the tenant failing to pay its rent, Helvetia stands surety for the landlord’s rental claim as a joint and several guarantor. Advantage for the policyholder (tenant): The policyholder does not need to put pressure on its liquidity with a blocked account.
Transport companies that regularly cross the Swiss border complete their customs clearance on a cashless basis via an account of the Swiss Federal Directorate General of Customs. However, they must lodge a customs bond or a corresponding surety. Helvetia, acts as a guarantor standing surety on a joint and several basis for customs liabilities toward the Directorate General of Customs.
Additional sureties can be provided, for example for gravel extraction, waste disposal abroad, etc.