Forging stronger business bonds

Rob Driscoll, ECA Director of Legal and Business, explains why the Association’s refreshed Bond assurance product can provide a boost for Members and their clients.

It’s widely recognised that ECA Members deliver excellence in electrical projects across a range of UK buildings and infrastructure. And, as the leading Association for this vital sector, we stand behind the competence of our Members as they deliver this essential work.

In addition to a range of legal and business services freely available to Members, an established feature of this support has been ECA’s Warranty and Bond protections for Members and their clients. 

As separate products, the Warranty and Bond essentially did two jobs. First, the Warranty provided ECA Members’ customers with assurance that works would meet the appropriate standard(s). And second, the Bond reassured customers that works would be completed in the eventuality of contractor insolvency. 

Once a project is registered, Members can download a certificate to give to their clients. This documentation is required in the event of any future claim, as well as providing valuable documentation trail for Members’ records

Even so, over the years, ECA’s Business Policy & Practice Member committee noted that take-up of the products was lower than might be expected, noting that many Members told ECA the products were perceived as having unique value as part of Membership. 

Therefore, to help and encourage more Members to engage with these potentially valuable offerings, we have now combined them into one product, exclusively free to Members, now known as the ECA Bond (2023). The refreshed and combined Bond (2023) provides the same assurances as the two previous products, covering: 

• insolvency prior to completion; and 
• technical compliance after completion, for up to six years.

The updated Bond (2023) is for commercial projects valued over £50,000 – for projects under £50,000 Members should access ECA freely available Guarantee of Works.

One of the key requirements of the Bond (2023) is that to activate coverage, Members must first register the project and client. This is done through the Member area of the ECA website, which links directly to ECA’s insurance partner, Markel (formerly ECIC). Members can then complete the registration, which will include details of company turnover. 

The Bond [...] can demonstrate quality and value to business clients and provide them with a route to saving costs

Once a project is registered, Members can download a certificate to give to their clients. This documentation is required in the event of any future claim, as well as providing valuable documentation trail for Members’ records.

We encourage ECA Members to find out more about, and make the most of, this refreshed assurance product. Not only can it help to provide peace of mind for customers, but it may also help them to save costs. Many of our Members know that clients frequently request a Performance Bond at the outset of projects. 

These provide assurances around the completion of work that meet obligations set out by the client which may go beyond technical standards. However, performance Bonds, purchased from insurance companies or banks, can be expensive, often costing tens of thousands of pounds. In various situations, the ECA Bond (2023), combining as it does the former Warranty and Bond into one product, may provide a cost-effective alternative. 

While its assurance level may be slightly lower than a given Performance Bond, the ECA Bond (2023) provides that work will meet technical standards and be completed even in the case of contractor insolvency. And since the ECA Bond (2023) is freely available to Members, they can offer it as a cost-saving to clients. Given the cost saving involved, it seems likely that many clients would be interested in hearing about this option. 

The popular ECA Guarantee of Work Scheme for smaller (usually domestic) projects is still available

As a result of the above, the  previous ECA Warranty and Bond were withdrawn in January 2023, but all earlier issues of these products will continue to be honoured, in line with their terms and conditions. 

ECA Members may also be interested to know that the popular ECA Guarantee of Work Scheme for smaller (usually domestic) projects is still available. The Guarantee provides ‘automatic’ coverage, meaning that Members do not have to register their projects. 

Instead, Members can issue a certificate to the customer once the work is completed, along with the Guarantee’s terms and conditions. The Guarantee provides customers with reassurance that ECA will cover the cost of remedial work if a project is not compliant with relevant electrical standards, as well as providing a discount of £1.65 for each ‘Part P’ building regulations registration. 

ECA’s Business Policy & Practice team encourages Members to make full use of the new ECA Bond (2023), which can demonstrate quality and value to business clients and provide them with a route to saving costs on their projects.  

ECA is the UK's leading trade association for the electrotechnical and wider engineering services industry. We aim to drive growth and prosperity for the industry and our Member organisations. Learn more about the benefits of ECA membership here.