Tender commitment
Bid and tender bonds
Security for a bidder's obligation to keep its offer open, execute the contract and provide required post-award security.
Submit this type of riskA bid or tender bond gives the procuring authority confidence that a bidder will honour the commitments made in its tender. It may respond if the bidder withdraws during the validity period, refuses an award made in accordance with the tender or fails to provide the required performance security.
Although normally shorter in duration than a performance bond, bid security can create rapid and concentrated exposure. Titanium reviews bid rules, qualification criteria, the applicant's pricing and delivery capability, and the transition from tender security to any subsequent bonds.
Typical uses
Where it can apply.
- Government and public-authority procurement
- Infrastructure concessions
- Construction and engineering tenders
- Large equipment or supply competitions
Underwriting focus
What drives the decision.
- Tender validity, award mechanics and bid bond forfeiture terms
- Realism of price, programme and technical proposal
- Applicant approval to bid and capacity to deliver if successful
- Expected performance and advance-payment bond requirements
Initial submission
Information that moves the review forward.
A complete pack reduces assumptions and allows legal structure, wording and credit to be considered together.
- 01
Invitation to tender and bid conditions
- 02
Tender submission or executive summary
- 03
Proposed bond wording
- 04
Bid value, bond amount and validity period
- 05
Evidence of technical qualification and relevant experience
- 06
Expected post-award security package
Important considerations
Structure remains case specific.
- Tender amendments and extensions require review.
- The likely post-award bond requirement is considered at bid stage.
- Local public-procurement rules may prescribe wording or issuer eligibility.
Common questions
Clear answers before submission.
Does support for a bid bond guarantee the performance bond?
No. Future support depends on the final contract, wording, financial position, aggregate exposure and underwriting approval at that time.
Can a tender extension be accommodated?
Potentially, but it should be requested before expiry and is subject to review of the revised tender timetable and exposure.
Discuss an opportunity
Discuss a bid / tender bonds opportunity.
Our review starts with the underlying obligation, the applicant and the legally compliant route to issuance.
Submit a risk