Bond Product
Advance Payment Bond in the Philippines
Security for mobilization or down payments released ahead of accomplishment.
Overview
An advance payment bond secures an advance or mobilization payment released by the obligee before corresponding work is accomplished. It is commonly issued at the full value of the advance and reduces as the advance is recouped from progress billings.
It is frequently required together with the performance security on infrastructure and supply contracts.
Purpose
- Protects the obligee's funds released ahead of accomplishment.
- Enables contractors to obtain mobilization funding at the start of a project.
- Keeps recoupment schedules enforceable through a surety undertaking.
Who needs this bond
- Contractors receiving a 15 percent mobilization or advance payment
- Suppliers requiring a down payment to procure materials
- Equipment vendors with milestone-based advance billings
Typical requirements
- Accomplished bond application with obligee and contract details
- SEC or DTI registration, Articles of Incorporation or business permit
- BIR Certificate of Registration and latest tax return
- Audited financial statements for the last two to three years
- Valid government IDs of signatories and board or partnership authority
- Copy of the obligee's bond requirement, invitation to bid, or contract
- Signed contract showing the advance payment provision
- Billing or request for release of the advance
Final requirements depend on the obligee and the issuing insurance company. See the full requirements guide.
Bond request and insurer process
Step 1
Submit a bond request
Open a bond request in your SuretyPH portal and enter the obligee, contract, and bond details.
Step 2
Upload requirements
Follow the guided checklist and upload each document securely to your transaction file.
Step 3
Pre-assessment
We review the file for completeness and refer it to a participating licensed insurance company.
Step 4
Insurer evaluation and quotation
The insurer evaluates the submission and provides a quotation covering premium, fees, and any collateral requirement.
Step 5
Payment and issuance
Once the quotation is accepted and the premium settled, the insurer issues the bond for release or delivery.
Frequently asked questions
Does the bond amount decrease over time?
Many advance payment bonds are written to reduce as the advance is recouped, if the obligee's requirement and the insurer's wording allow it.
Is this the same as a performance bond?
No. It secures the money advanced to you; the performance bond secures completion of the contract itself.
Related bonds and guides
Many projects require more than one security. Compare a performance bond in the Philippines, a bid bond in the Philippines and a warranty bond in the Philippines, or browse every Philippine surety bond type to confirm which security your obligee requires.
SuretyPH is a digital platform for surety bond information, inquiries, requirements and request tracking. It does not underwrite, approve, bind, issue, or guarantee any insurance policy or surety bond. Evaluation, underwriting, approval, pricing and issuance are undertaken by the applicable licensed insurance company.