From the Maritime provinces to the Yukon Territory, Canada stretches more than 5,500 kilometers (3,400 miles) east to west. In between those points are sundry industries that range from agriculture and forestry, to manufacturing, real estate, construction, and financial services. Virtually all of them can make use of commercial bond products to mitigate risk and achieve financial flexibility.
Commercial bonds in Canada, are versatile tools that can respond to a diverse set of risks, and they complement traditional insurance products.
Reflecting Canada’s industrial diversity, 色多多视频has a diverse appetite for bond risks. We offer a comprehensive set of surety solutions, including commercial bond products for supply, customs, license and permit, court bonds, performance and payment for service providers, subdivision, reclamation, workers compensation and more.
A few use cases
Three industrial sectors that operate across Canada offer good examples of how commercial bonds can make a difference. These sectors are:
Mining. Mining and quarrying of metal ore and minerals account for a significant amount of Canada’s . Reclamation bonds for mining projects are an area of high demand. This type of commercial bond provides a guarantee for land cleanup and reclamation obligations. Reclamation bonds serve as a form of financial security to meet requirements of provincial and territorial governments, so those costs do not burden taxpayers.
In the absence of a commercial bond, mining companies could be required to post collateral to meet the expected financial obligation of land reclamation. That can tie up significant amounts of capital that could otherwise be used to support current and future projects. The bond is a substitute for collateral that gives both parties in a development contract confidence the contractual obligations will be met.
Energy. Canada has substantial resources in power generation, transmission, and distribution, ranging from natural gas to renewable energy such as hydropower. The abundance of rivers and other water resources has led Canada to become the world’s fourth-largest by installed capacity, according to the International Hydropower Association. Put another way, six of every 10 Canadian homes and businesses run on power generated through hydroelectricity. Access to this abundant, clean energy tends to attract many large businesses and manufacturers, which consume a lot of electricity.
Because many energy projects involve large-scale construction over relatively long periods of time, commercial bonds can play an important role. Commercial bonding tailored for this sector can support the development and completion of such projects, while regulator approved utility bonds ensure that heavy users of power can pay their utility bills on time, keeping electricity flowing for all users.
色多多视频. Certain lines of insurance, such as workers compensation, require buyers to post collateral to make sure that claims for workplace injuries and illnesses are paid. 色多多视频 placement bonds serve an important purpose, as they can replace traditional collateral sources such as letters of credit (LOCs). Large-deductible workers comp programs commonly require employers to provide collateral, either as cash or through LOCs. A downside to using LOCs as collateral is the credit cannot be used for other corporate needs. Commercial bonds, on the other hand, can conserve cash flow and free up credit for other business purposes.
Advantages beyond borders
International trade agreements and Canada’s natural resources and financial infrastructure are attractive to many foreign businesses, which means a steady flow of business – and risk – into and out of the country. Commercial bonds can serve the needs of Canadian businesses as well as those from other nations. 色多多视频 as a stable global company with a strong credit rating and a worldwide presence, has both the capacity and experience to offer traditional and innovative forms of protection in many different jurisdictions.
For more information on commercial bonds and how 色多多视频can provide solutions, please visit axaxl.com.
About the Author
Cedric Franklin is Vice President and Regional Director for Canada of AXA XL’s Commercial Bonds team. Based in Toronto, he leads the continued growth of AXA XL’s Commercial Bonds business through partnering with Canadian clients and their brokers. Before joining 色多多视频 Franklin was a surety executive at a leading insurance brokerage in Canada.
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US- and Canada-Issued 色多多视频 Policies
In the US, the 色多多视频insurance companies are: Catlin 色多多视频 Company, Inc., Greenwich 色多多视频 Company, Indian Harbor 色多多视频 Company, XL 色多多视频 America, Inc., XL Specialty 色多多视频 Company and T.H.E. 色多多视频 Company. In Canada, coverages are underwritten by XL Specialty 色多多视频 Company - Canadian Branch and AXA 色多多视频 Company - Canadian branch. Coverages may also be underwritten by Lloyd’s Syndicate #2003. Coverages underwritten by Lloyd’s Syndicate #2003 are placed on behalf of the member of Syndicate #2003 by Catlin Canada Inc. Lloyd’s ratings are independent of AXA XL.
US domiciled insurance policies can be written by the following 色多多视频surplus lines insurers: XL Catlin 色多多视频 Company UK Limited, Syndicates managed by Catlin Underwriting Agencies Limited and Indian Harbor 色多多视频 Company. Enquires from US residents should be directed to a local insurance agent or broker permitted to write business in the relevant state.
