Protect advance funds. Unlock project cash flow.
An Advance Payment Guarantee (also called an Advance Payment Bond) reassures the Employer/Buyer that the advance they release to a contractor or supplier will be repaid—or the guarantor will pay—if the contractor fails to perform or to liquidate the advance as agreed.
When you need it:
- Public procurement contracts (works, services, supplies).
- EPC and infrastructure projects (energy, roads, water, telecom).
- Housing and real estate developments.
What it covers:
- On-demand security for the advance amount stated in the contract or award.
- Tenor aligned to the advance-recovery schedule and milestones.
- Automatic reduction (amortisation) as the Employer deducts the advance from interim payments.
- Governing law & wording matched to the contract (Kenya or as required).
- Callable if the contractor defaults, is insolvent, or fails to repay/unwind the advance.
Why Imperial Insurance Brokers
- We arrange APGs through IRA-licensed insurers and rated international underwriters.
- Premium-based solutions that minimise or eliminate cash collateral requirements.
- Compliance-ready for Kenyan public entities (PPADA 2015 & Regulations) and private employers.
- Sector expertise across affordable housing, solar & energy, EPC, and commodity trade.
How it works
- Submit your contract pack – award letter/contract, advance clause, amount, schedule, and beneficiary details.
- Risk structuring – we align wording, jurisdiction, and reduction mechanics with your contract.
- Underwriter approval – pricing and conditions issued; upon acceptance, the guarantee is executed.
- Issuance – original guarantee delivered to the beneficiary; copies to you for records.
Eligibility checklist
- Executed contract or binding award letter (with the advance payment clause).
- Beneficiary name and address as they must appear on the guarantee.
- Advance amount and reduction schedule tied to certificates/interim payments.
- Corporate KYC: certificate of incorporation, directors/CR12, PIN/VAT, address, authorised signatories.
- Financials and project profile (as requested by underwriters).
Documents we’ll ask for
- Contract / Award Letter (signed or award confirmation).
- Advance Payment terms & schedule.
- Beneficiary’s prescribed wording (if any).
- Performance Bond terms (if separate).
- Company KYC & financials.
Typical features we arrange
- Amount: up to the full advance stated in the contract.
- Form: on-demand guarantee or insurance bond.
- Currency: KES / USD / EUR (others on request).
- Reduction: pro-rata with each IPC/valuation certificate.
- Assignment & step-in language where required by lenders/employers.
FAQ
What would you like to know?
APG secures the advance funds; a Performance Bond secures contract performance. Many employers require both.
Yes—when structured with an amortisation clause, the guaranteed amount reduces as the employer recovers the advance.
Our solutions are premium-based. Depending on risk, underwriters may request limited security or covenants—far lighter than traditional bank cash-collateralised instruments.
Yes—when issued by IRA-licensed insurers and drafted to PPADA-compliant, on-demand terms acceptable to the procuring entity.
