What does On Demand Bond mean? Read on to discover the definition & meaning of the term On Demand Bond - to help you better understand the language used in insurance policies.
On Demand Bond
An unconditional bond or bank guarantee required of many contractors and sellers by overseas buyers to guarantee the tender (the actual form of money exchanged) as security against the value of advance payments under a contract, or to guarantee performance of the contract. Payable "on demand," these bonds and guarantees may be called even when the contract has not been breached or when the breach is caused by circumstances outside the contractor's or seller's control, such as a trading embargo.
We hope the you have a better understanding of the meaning of On Demand Bond.