Parties to a bond:

i)   Principal – This is the party on whose behalf the bond is executed.

ii)   Surety / Guarantor – This is the party that issues the guarantee on behalf of the principal.

iii)  Beneficiary – This is the party to whose benefit the guarantee is issued.

SURETY BONDS OFFERED BY HERITAGE INSURANCE

1. Immigration Bonds

Issued to the government on behalf of foreigners (non-citizens) seeking legal authorization to take employment or residence in Kenya.

2. Bid Bond / Tender Security

Issued where a Procuring entity is requesting for bids (tenders) on certain works and requires security against the risk of the successful bidder failing to sign the contract at the agreed terms. 

3.Performance Bond

Issued to guarantee satisfactory completion of defined obligations by a principal.

4. Advance Payment Bond

An advance payment is a down payment given to the principal to facilitate performance of obligations in a contract. An advance payment bond guarantees that the principal will use the funds appropriately.

5.Retention Bond

Retention is an amount due to a contractor that is retained by the employer on each payment. The purpose of retention is to ensure the contractor follows up to correct defects. A retention bond allows for the retention amount to be paid up, with the bond securing this amount.

6.Warranty / Maintenance Bond

This is a bond that is provided as a guarantee that the works done under a contract will stay in a satisfactory condition for a specified period after completion. It ensures that the contractor maintains the project to the required standards.

7. Customs Bonds

This is a guarantee to the Government that the Principal will abide by all Laws and regulations governing the payment of Customs revenue together with the proper carrying on of business in dutiable items on which duty is not paid due to a number of pre-determined factors. These pre-determined factors determine the precise type of customs bond to be taken up.