Guarantees - KUKE

Guarantees

A guarantee confirms the capability of your company to perform a given contract.

Your customer, when ordering goods or services, may require a specific financial collateral in case the contract is breached, performance deadlines are not being met, or the quality of the goods and services is not satisfactory. With a guarantee from KUKE, you are confirming your credibility because KUKE undertakes to compensate your customer the amount specified in the guarantee in case something goes wrong with the contract.

What are the benefits of guarantees offered by KUKE?

You are free to use cash required to secure the performance of the contracts for other business puroposes.

You do not have to provide your customer with other collateral for the performance of the contract.

Contrary to bank guarantees, guarantees issued by KUKE do not encumber your credit line with the bank.

Guarantees secure a wide range of domestic and export contracts across all industries.

KUKE is the only insurance company in Poland authorized to issue export guarantees backed by the State Treasury.

Guarantees are issued quickly thanks to a general agreement concluded between KUKE and your company.

Benefits for your company

Credibility

You’re boosting the credibility of your company in the eyes of your customers.

Improved liquidity

You’re freeing up cash for growth and development and you can bid in numerous tenders simultaneously.

Gain international outreach

Grow your export business – guarantees issued by KUKE are a form of security that is widely accepted by foreign buyers.

How it works

You contact KUKE and we analyse the needs and requirements of your company.
You provide us with the necessary documents and our team of specialists analyses the risks involved.: You receive a decision concerning our cooperation. If the decision is positive, you also receive an offer specifying financial terms and conditions of our future cooperation.
We conclude a general agreement and KUKE opens a guarantee line for your company within which specific guarantees are issued.
Guarantees are issued based on an application submitted by you.

Guarantees offered by KUKE

Contract Guarantees

Secure every stage of the contract using Contract Guarantees:
- Bid Bond
- Performance Guarantee
- Advance Payment Guarantee
- Warranty Guarantee

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Environmental Guarantee

Designed for companies whose operations may give rise to adverse environmental effects. In order to comply with the statutory requirements and obligations, they must present appropriate financial security to competent public administration bodies.

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Payment Guarantees for Exporters

Present a guarantee securing the timely repayment of your commitments to your foreign or domestic suppliers and get favourable payment terms in return.

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Zielone gwarancje

They allow for the financing of expenses related to the energy transformation, as well as the implementation of investment projects and obtaining better bank lending conditions.

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How can we assist you?

We will help you choose solutions best suited for your business.

Frequently asked questions

What is an insurance guarantee?

An insurance guarantee is a written commitment by an insurer (guarantor) to pay a specified amount to the beneficiary of the guarantee (the entity for which the guarantee was issued) if the conditions specified in the guarantee are met, for example, if a contractor fails to fulfill their obligations to the beneficiary. In practice, insurance guarantees are widely used, for example, in the construction industry, where investors protect themselves against non-performance or improper performance of construction works. Guarantees can replace the payment of the amount required by the beneficiary (e.g., bid bond guarantees), provide security for damages (e.g., environmental guarantees), or secure payments under a loan (payment guarantees).

How is an insurance guarantee different from a bank guarantee?

The fundamental difference between an insurance guarantee and a bank guarantee is the guarantor. In the former, it is an insurance company, in the latter, it is a bank. An important difference from a business's perspective is that an insurance guarantee does not negatively impact the company's creditworthiness. A bank guarantee is treated on a par with a loan, which means the company has a lower creditworthiness for the duration of the guarantee. An insurance guarantee does not reduce the company's creditworthiness.

Why does KUKE collect security when issuing an insurance guarantee?

When deciding whether to issue a guarantee, KUKE must assess the risk associated with the project, most often the contract for which it intends to issue the guarantee. First, KUKE verifies whether the obligation covered by the guarantee is realistically fulfilled. Second, it must obtain security for the repayment of the amount paid to the beneficiary (client) specified in the guarantee agreement (so-called recourse). To this end, KUKE requires the client to provide appropriate security, typically a blank promissory note.

What is a master guarantee agreement under a revolving guarantee limit?

A general agreement is concluded between the client and KUKE and specifies the basic terms of cooperation in the provision of insurance guarantees, including the method of issuing guarantees, pricing terms, the revolving limit within which guarantees will be granted (the sum of all applicable guarantees granted to the client cannot exceed the revolving limit; expired guarantees release the limit capacity), the type of security provided by the client, the types of insurance guarantees available, and the maximum duration of the guarantee. Thanks to the general agreement, clients can quickly apply for further guarantees without unnecessary formalities.

What types of security are used when providing an insurance guarantee?