Nitin Gadkari launches ‘Surety Bond Insurance’ from Bajaj Allianz
Union Road Transport and Highways Minister Nitin Gadkari launched one of India’s first-ever surety bond insurance products from Bajaj Allianz General Insurance. The product launch is in line with the government’s vision to boost infrastructure development to increase the pace of development of upcoming projects in the country.
The Surety bond insurance will act as a security arrangement for infrastructure projects and will cover the contractor as well as the principal. The product gives the principal a contract of guarantee that contractual terms and other business deals will be concluded in accordance with the mutually-agreed terms.
The product will also help in reducing the contractors’ debts to a large extent thus addressing their financial worries. Nitin Gadkari said, “With this new instrument of surety bonds, the availability of both liquidity and capacity will definitely be boosted; such products stand to strengthen the sector.”
The surety bond insurance does not require a large collateral from the contractor, thus freeing up significant funds for the contractor, which they can utilise for the growth of the business. Tapan Singhel, Managing Director and Chief Executive Officer of Bajaj Allianz General Insurance, said surety bond insurance will prove to be an effective tool for the industry and will allow contractors to take up more projects as the product will help them optimise capital.
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