Europe Surety Market Size and Forecast (2021-2031)
Europe Surety Market Size and Forecast (2021 – 2031), Regional Share, Trend, and Growth Opportunity Analysis Report Coverage: By Bond Type (Contract Surety Bond and Commercial Surety Bond), End Users (Individuals and Enterprises), and Country
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Description
A surety bond is a legally mandatory agreement that ensures the fulfillment of obligations or, in case of non-compliance, provides compensation to cover the unmet obligations. This involves three parties: the principal (who purchases the bond and commits to fulfilling an obligation), the surety (the company issuing the bond), and the obligee (the entity requiring the bond). Surety bonds are a financial guarantee for the completion of specific obligations, holding bondholders accountable for their professional or personal commitments. They protect the government, businesses, and individuals from financial loss by ensuring compliance, payment, or performance of an act. The primary principle of a surety bond is to ensure the completion of contracts in the event of contractor default. They can also guarantee the completion of government contracts, cover losses resulting from legal cases, or safeguard companies from employee dishonesty.
A recent trend in the European market is the growing cooperation between banks and Surety companies to develop distribution and to offer cover for risks. Such cooperation is anticipated to develop prosperous opportunities for the Europe surety market players. Although banks propel the surety market in the European region, capital regulations are driving them to share some of their uncertainties with surety companies. This enables banks to mitigate their risks and achieve more cost-effective portfolio management. Moreover, surety players facilitate banks to enhance their customer relationships and expand their market share or enter new, niche markets. Also, cooperation with banks enables surety players to access clients and markets that were otherwise not reachable to them. Alternatively, the key challenge is expected from developing these new market distributions. Unlike banks being capacity providers, surety companies are bond underwriters. This could bring out a challenge for surety providers in gaining new customers, who are more inclined towards capacity providers. Although surety providers offer an equivalent portfolio, there is always a risk of adverse selection.
Another major challenge prevailing in the European surety market is the entrance of new players as well as the geographical expansion of existing players, resulting in intensifying competition. Simultaneously, the customers’ needs are constantly growing. Thus, surety providers who are capable of fulfilling these evolving customers’ needs are expected to sustain and compete efficiently in the Europe surety market.
Liberty Mutual Insurance Company, CNA FINANCIAL CORPORATION, Chubb, The Travelers Indemnity Company, Atradius N.V., Allianz SE, Arthur J. Gallagher & Co., Zurich Insurance Company Ltd, Coface, and Credendo are among the prominent players profiled in the Europe surety market. The Europe surety market report emphasizes the key factors driving the market and prominent players’ developments.
The overall Europe surety market size has been derived using both primary and secondary sources. Exhaustive secondary research has been conducted using internal and external sources to acquire qualitative and quantitative information related to the. The process also helps obtain an overview of the Europe surety market with respect to all the market segments. Also, multiple primary interviews have been conducted with industry participants to validate the data and gain analytical insights. This process includes industry experts such as VPs, business development managers, market intelligence managers, and national sales managers, along with external consultants such as valuation experts, research analysts, and key opinion leaders, specializing in the Europe surety market. The Europe surety market forecast can help stakeholders in this marketplace plan their growth strategies.
Summary Info
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In Europe, the aging power generation and distribution infrastructure are becoming key challenges for the utility sectors in developed countries. Hence, European countries are focused on establishing proper power generation and distribution infrastructure. For instance, according to the Power Barometer 2023 report, the power industry in Europe is expected to increase investments in aging grid infrastructure by 84% every year until 2050. The aging grid infrastructure is not suitable for accommodating decentralized renewables, electric vehicles and smart grids, and Eurelectric, which are major parts of the electricity industry. Although there was an increase of 8% in grid investments from 2021 to 2022, the report highlights the need for a boost of 84% in annual investment until 2050, indicating a rise in grid investments across Europe. However, over the past few years, several such infrastructures have been aging and require restoration. The restoration of power distribution and generation infrastructure incurs significantly massive overall costs; pertaining to this, the demand for surety bonds among the parties involved in restoration activity is growing across the region.
Moreover, as the number of vehicles on the road is constantly increasing in European countries, governments of several developed and developing countries are investing in the development of roads. For instance, in June 2023, the European Commission selected 107 transport infrastructure projects to receive over US$ 6.3 billion in EU grants from the Connecting Europe Facility (CEF), the EU’s instrument for strategic investment in transport infrastructure. The number of road construction projects is increasing across Europe, which is generating substantial demand for surety bonds between the respective government or awarding authority and contractors owing to the benefits offered by such bonds. Thus, the growing need for the restoration of aging infrastructure in European economies fuels the Europe surety market growth.
The Europe surety market is segmented into the UK, Germany, France, Spain, Italy, and the Rest of Europe. France held the largest Europe surety market share in 2023. In Europe, government bodies are making significant investments in infrastructure projects, including transportation, energy, and construction. In June 2023, the European Commission selected 107 transport infrastructure projects to receive over US$ 6,309.3 million in EU grants from the Connecting Europe Facility (CEF), thereby promoting investment in transport infrastructure. More than 80% of the funding is dedicated to support projects that deliver a highly efficient, greener, and smarter network of railways, inland waterways, and maritime routes along the trans-European transport (TEN-T) network. These projects will bolster the EU-Ukraine Solidarity Lanes that are set up to facilitate Ukraine’s exports and imports. Surety bonds are mostly required for these projects to ensure completion according to contract terms. With the European Union’s focus on infrastructure development, the demand for surety bonds is likely to increase in the coming years. Also, a rise in regulatory changes and initiatives, such as updates in construction regulations or requirements for public-private partnerships (PPPs) and regulatory frameworks that promote transparency and risk mitigation, are boosting the demand for surety bonds across Europe.
Housing construction in the UK is growing rapidly, giving a boost to the country’s construction sector. Also, the National Infrastructure Pipeline 2024 of the UK government comprises more than 600 projects and programs valued at ~US$ 460.49 billion. The growing construction activities will further drive the Europe surety market during the forecast period. Moreover, there has been a record-breaking number of construction insolvencies in the UK in 2023. For instance, in March 2023, 38 construction companies entered administration. Furthermore, two high-profile insolvencies, Henry Construction and Buckingham Group (two large contractors turning over US$ 502 million and US$ 840.4 million, respectively), entered into administration in 2023. Thus, the increasing number of construction projects is boosting the demand for surety bonds.
Based on bond type, the market is bifurcated into contract surety bond and commercial surety bond. The contract surety bond segment held a larger Europe surety market share in 2023. A contract surety bond is also known as a contractor bond; a contract bond is a type of surety bond that investors and developers use in the construction sector as a guarantee that the terms and conditions of the contract will be fulfilled. The contract bond protects against the losses incurred due to the contractor’s failure to complete the project or meet the contract specification. Surety providers evaluate the principal builder’s financial merits and charge a premium in accordance with the likeness of the occurrence of an adverse event. Commercial bonds are general surety bonds that are required of businesses and individuals by government agencies such as state, local, or federal, along with various statutes, ordinances, regulations, or other entities. These entities can easily qualify for commercial bonds as they incur low risk.
Europe Surety Market Report Segmentation and Scope:
The “Europe surety market analysis” has been carried out by considering the following segments: bond type, end users, and geography. Based on bond type, the Europe surety market is bifurcated into contract surety bond and commercial surety bond. By end users, the market is divided into individuals and enterprises. Based on geography, the Europe surety market is segmented into the UK, Germany, France, Spain, Italy, and the Rest of Europe.
Liberty Mutual Insurance Company, CNA FINANCIAL CORPORATION, Chubb, The Travelers Indemnity Company, Atradius N.V., Allianz SE, Arthur J. Gallagher & Co., Zurich Insurance Company Ltd, Coface, and Credendo are among the prominent players profiled in the Europe surety market report. In addition, several other players have been studied and analyzed during the study to get a holistic view of the market and its ecosystem. The Europe surety market forecast can help stakeholders plan their growth strategies.
Europe Surety Market Recent Developments:
Inorganic and organic strategies such as mergers and acquisitions are highly adopted by companies operating in the Europe surety market. As per the company press releases, below are a few recent key developments:
• In 2023, Arthur J. Gallagher & Co. announced the acquisition of Phoenix, Arizona-based Viking Bond Service, Inc. The terms of the transaction were not disclosed. Viking Bond Service, founded in 2002, is a surety bond agency specializing in commercial, contract, and fidelity bonds for clients across the US. Tom Buckner, Bill Belpedio, and their team will operate under the direction of Kevin Garvin, head of Affinity North America, for Gallagher’s retail property/casualty brokerage operations.
• In 2021, COFACE, a credit insurer, announced the plan to expand its portfolio in the Romanian insurance market by entering the surety bonds segment. The company provided a statement on its website—”a viable alternative to the letter of credit and are dedicated to companies involved in public procurement contracts.”
o Highlights key business priorities in order to assist companies to realign their business strategies
o The key findings and recommendations highlight crucial progressive industry trends in the Europe surety market, thereby allowing players across the value chain to develop effective long-term strategies
o Develop/modify business expansion plans by using substantial growth offering developed and emerging markets
o Scrutinize in-depth global market trends and outlook coupled with the factors driving the market, as well as those hindering it
o Enhance the decision-making process by understanding the strategies that underpin commercial interest with respect to client products, segmentation, pricing and distribution
TABLE OF CONTENTS
1. Introduction
1.1 the Research Team Research Report Guidance
1.2 Market Segmentation
2. Executive Summary
2.1 Key Insights
3. Research Methodology
3.1 Secondary Research
3.2 Primary Research
3.2.1 Hypothesis formulation:
3.2.2 Macro-economic factor analysis:
3.2.3 Developing base number:
3.2.4 Data Triangulation:
3.2.5 Country level data:
4. Europe Surety Market Landscape
4.1 Overview
4.2 PEST Analysis
4.3 Ecosystem Analysis
4.3.1 List of Vendors in the Value Chain
5. Europe Surety Market – Key Market Dynamics
5.1 Europe Surety Market – Key Market Dynamics
5.2 Market Drivers
5.2.1 Increasing Adoption of Public-Private Partnerships for Infrastructure Development
5.2.2 Growing Need for Restoration of Aging Infrastructure in European Economies
5.3 Market Restraints
5.3.1 Shortage of Properly Trained Underwriters in Surety Industry
5.4 Market Opportunities
5.4.1 Rapid Urbanization in Europe
5.5 Future Trends
5.5.1 Rise in Digitalization, Automation, and Other Technological Advancements
5.6 Impact of Drivers and Restraints:
6. Europe Surety Market Analysis
6.1 Europe Surety Market Revenue (US$ Million), 2023–2031
6.2 Europe Surety Market Forecast and Analysis
7. Europe Surety Market Analysis – by Bond Type
7.1 Contract Surety Bond
7.1.1 Overview
7.1.2 Contract Surety Bond: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
7.2 Commercial Surety Bond
7.2.1 Overview
7.2.2 Commercial Surety Bond: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
8. Europe Surety Market Analysis – by End Users
8.1 Individuals
8.1.1 Overview
8.1.2 Individuals: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
8.2 Enterprises
8.2.1 Overview
8.2.2 Enterprises: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9. Europe Surety Market – Country Analysis
9.1 Europe
9.1.1 Europe Surety Market Breakdown by Countries
9.1.2 Europe Surety Market Revenue and Forecast and Analysis – by Country
9.1.2.1 Europe Surety Market Revenue and Forecast and Analysis – by Country
9.1.2.2 Germany: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.2.1 Germany: Europe Surety Market Breakdown by Bond Type
9.1.2.2.2 Germany: Europe Surety Market Breakdown by End Users
9.1.2.3 France: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.3.1 France: Europe Surety Market Breakdown by Bond Type
9.1.2.3.2 France: Europe Surety Market Breakdown by End Users
9.1.2.4 Italy: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.4.1 Italy: Europe Surety Market Breakdown by Bond Type
9.1.2.4.2 Italy: Europe Surety Market Breakdown by End Users
9.1.2.5 United Kingdom: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.5.1 United Kingdom: Europe Surety Market Breakdown by Bond Type
9.1.2.5.2 United Kingdom: Europe Surety Market Breakdown by End Users
9.1.2.6 Spain: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.6.1 Spain: Europe Surety Market Breakdown by Bond Type
9.1.2.6.2 Spain: Europe Surety Market Breakdown by End Users
9.1.2.7 Rest of Europe: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
9.1.2.7.1 Rest of Europe: Europe Surety Market Breakdown by Bond Type
9.1.2.7.2 Rest of Europe: Europe Surety Market Breakdown by End Users
10. Competitive Landscape
10.1 Heat Map Analysis by Key Players
10.2 Company Positioning & Concentration
11. Industry Landscape
11.1 Overview
11.2 Market Initiative
11.3 Product Development
11.4 Mergers and Acquisitions
12. Company Profiles
12.1 Zurich Insurance Group AG
12.1.1 Key Facts
12.1.2 Business Description
12.1.3 Products and Services
12.1.4 Financial Overview
12.1.5 SWOT Analysis
12.1.6 Key Developments
12.2 CNA Financial Corp
12.2.1 Key Facts
12.2.2 Business Description
12.2.3 Products and Services
12.2.4 Financial Overview
12.2.5 SWOT Analysis
12.2.6 Key Developments
12.3 Liberty Mutual Holding Co Inc
12.3.1 Key Facts
12.3.2 Business Description
12.3.3 Products and Services
12.3.4 Financial Overview
12.3.5 SWOT Analysis
12.3.6 Key Developments
12.4 Atradius NV
12.4.1 Key Facts
12.4.2 Business Description
12.4.3 Products and Services
12.4.4 Financial Overview
12.4.5 SWOT Analysis
12.4.6 Key Developments
12.5 Chubb Ltd
12.5.1 Key Facts
12.5.2 Business Description
12.5.3 Products and Services
12.5.4 Financial Overview
12.5.5 SWOT Analysis
12.5.6 Key Developments
12.6 The Travelers Companies Inc
12.6.1 Key Facts
12.6.2 Business Description
12.6.3 Products and Services
12.6.4 Financial Overview
12.6.5 SWOT Analysis
12.6.6 Key Developments
12.7 COFACE SA
12.7.1 Key Facts
12.7.2 Business Description
12.7.3 Products and Services
12.7.4 Financial Overview
12.7.5 SWOT Analysis
12.7.6 Key Developments
12.8 Credendo
12.8.1 Key Facts
12.8.2 Business Description
12.8.3 Products and Services
12.8.4 Financial Overview
12.8.5 SWOT Analysis
12.8.6 Key Developments
12.9 Arthur J Gallagher & Co
12.9.1 Key Facts
12.9.2 Business Description
12.9.3 Products and Services
12.9.4 Financial Overview
12.9.5 SWOT Analysis
12.9.6 Key Developments
12.10 Allianz Trade
12.10.1 Key Facts
12.10.2 Business Description
12.10.3 Products and Services
12.10.4 Financial Overview
12.10.5 SWOT Analysis
12.10.6 Key Developments
13. Appendix
13.1 Glossary
13.2 About the Research Team
LIST OF TABLES
Table 1. Europe Surety Market Segmentation
Table 2. List of Vendors
Table 3. Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Table 4. Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 5. Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 6. Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Country
Table 7. Germany: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 8. Germany: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 9. France: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 10. France: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 11. Italy: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 12. Italy: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 13. United Kingdom: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 14. United Kingdom: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 15. Spain: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 16. Spain: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 17. Rest of Europe: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by Bond Type
Table 18. Rest of Europe: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million) – by End Users
Table 19. Heat Map Analysis By Key Players
LIST OF FIGURES
Figure 1. Europe Surety Market Segmentation, by Country
Figure 2. PEST Analysis
Figure 3. Ecosystem Analysis
Figure 4. Impact Analysis of Drivers and Restraints
Figure 5. Europe Surety Market Revenue (US$ Million), 2021–2031
Figure 6. Europe Surety Market Share (%) – by Bond Type, 2023 and 2031
Figure 7. Contract Surety Bond: Europe Surety Market– Revenue and Forecast to 2031 (US$ Million)
Figure 8. Commercial Surety Bond: Europe Surety Market– Revenue and Forecast to 2031 (US$ Million)
Figure 9. Europe Surety Market Share (%) – by End Users, 2023 and 2031
Figure 10. Individuals: Europe Surety Market– Revenue and Forecast to 2031 (US$ Million)
Figure 11. Enterprises: Europe Surety Market– Revenue and Forecast to 2031 (US$ Million)
Figure 12. Europe Surety Market Breakdown by Key Countries, 2023 and 2031 (%)
Figure 13. Germany: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 14. France: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 15. Italy: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 16. United Kingdom: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 17. Spain: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 18. Rest of Europe: Europe Surety Market – Revenue and Forecast to 2031 (US$ Million)
Figure 19. Company Positioning & Concentration
The List of Companies – Europe Surety Market
o Liberty Mutual Insurance Company
o CNA FINANCIAL CORPORATION
o Chubb
o The Travelers Indemnity Company
o Atradius N.V.
o Allianz SE
o Arthur J. Gallagher & Co.
o Zurich Insurance Company Ltd
o Coface
o Credendo
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