Surety Bonds & Guarantees

Surety bonds guarantee that suppliers can meet financial obligations when contracted performance targets are missed. Many major projects are impossible without them.

Howden consultants take the stress out of the entire process. We arrange the bond with the appropriate insurer and manage the ongoing process of issuing guarantees in-line with our clients’ requirements. 

We are the first broker in Israel to specialise in Surety Bonds

A surety is a contract between three or more parties: a supplier of some kind, their client and an insurance company (surety bonds are available through banks also, but banks tend to be less flexible in their terms and the bond exists on your balance sheet, whereas the insurance company’s surety does not). 

The three parties are: 

1. The Principal (bondholder) 
2. The Obligee (bond holder’s client) 
3. The Surety (the insurance company) 

Sureties in Israel fall into two broad categories:

Housing bonds

There are two types of Housing Bonds – those that are based on the 1974 Apartment Sales Law, and those that aren’t. According to this law, if a developer takes a deposit of 7% or more from the buyer of the property in advance of its completion, they must provide the purchaser with either a bank guarantee or a surety policy (a Housing Bond).

At Howden, we provide Housing Bonds for Israeli developers, only in projects in which the insurance company cooperates with a financing body for the joint accompaniment of the project.
 

Contract Surety Bonds 

Contract Surety Bonds are guarantees issued on behalf of an entity entering into a contract with a private company, or a public or government agency. 

We provide Contract Bonds for Israeli infrastructure contractors, only when the beneficiary is the State of Israel or Semi-Governmental Institutes.

We serve as an underwriting agency for Israeli insurance companies operating in the fields of real estate and infrastructure. With our expertise in the area, we provide a holistic solution in underwriting and operating Housing and Contract Surety Bonds.

The process of underwriting and approval of projects is based on the professional methodology created by the Agency, relying on the extensive professional experience of its employees.