PETROLEUM BONDS
Petroleum Bonds “Petro Bonds”
What is a Petroleum Bond?
FAQ’s
A Petroleum Bond is an unconditional guarantee provided by CGU Insurance Ltd (“CGU”) in favour of an oil company on behalf of a customer e.g. service station retailer or wholesaler.
Unlike bank guarantees, petroleum bonds do not usually require collateral security on behalf of the retailer or distributor. In lieu of collateral security the service station dealer indemnifies the underwriter from any loss or cost incurred under the bond.
Petroleum bonds are the same as bank guarantees in that they are irrevocable, unconditional and pay on demand without reference to any third party.
Petroleum Bonds. It makes good sense.
COMMERCIAL INDEMNITY PTY LTD ABN 44 103 983 777
