Road and Transport Minister Nitin Gadkari on Monday issued the country’s first surety bond insurance. The move will reduce the dependence of bank guarantees of infra developers.
Road and Transport Minister Nitin Gadkari on Monday issued the country’s first surety bond insurance. The move will reduce the dependence of bank guarantees of infra developers. During this, the Union Minister said, India is on the way to become a five trillion economy. Insurance will play an important role in this achievement of the country.
He said, to realize the dream of Prime Minister Narendra Modi, it is important that infrastructure projects are implemented at a fast pace. Surety bond insurance will certainly increase the availability of both liquidity and capacity.
Gadkari further said that we are confident that expansion of road network will bring prosperity, increase employment opportunities and increase social connectivity. Surety Bond Insurance is the right step in this direction. I am happy to see that Bajaj Allianz General Insurance has taken a great initiative by launching this important product.
Contractor and company will get security
Union Minister Gadkari said, this bond will act as a security mechanism for infrastructure projects and will protect the company as well as the contractor. He said, the insurance bond is a risk transfer tool for the company and it protects against losses that may arise if the contractor fails to meet its contractual obligation.
This product gives the company a contract of guarantee that contractual terms and other business dealings will be concluded in accordance with the terms. If the contractor does not fulfill the terms of the contract, the company can claim the surety bond and recover its losses.
