When a Procuring entity seeks bids for a contract, they usually require a tender bond (also known as a bid bond) alongside the bid documents as a safeguard against the risk of the chosen bidder backing out. This bond acts as a guarantee, offering the beneficiary (the Procuring entity) the right to claim a specific amount within a set timeframe if the winning bidder fails to honor their commitment to the contract.

This is a guarantee given when money is paid before goods or services are supplied. So, if the client agrees to make an advance payment to a supplier on the premise of an Advance Payment Bond being supplied by the supplier, the bond secures the refund of the advance payment in case the supplier defaults, i.e. due to insolvency.

This is a guarantee given to the Kenya Revenue Authority on behalf of an importer of commercial merchandise or commodities that are subject to other government agencies’ requirements (e.g. firearms or food). It assures the tax authorities that the importer will pay all required duties, taxes, and fees, failure to which the insurer is obliged to cover these costs.