THE ESSENTIALS
Before you start
- Retention, guaranteed amount and premium are different figures.
- Do not copy public-contract rules into every private contract.
- Request replacement terms and confirmation of actual release.
The CCP rule on reinforcing security
Article 353 of Portugal's Public Contracts Code provides for 5% deductions from partial payments to reinforce security, unless the contract reduces or waives them. It permits replacement using specified instruments, including surety insurance, under the applicable performance-security terms. Check the contract's legal context rather than applying this indiscriminately to private arrangements.
One example of a product's purpose
Allianz Trade describes a reinforcement bond linked to proper performance that may enable release of invoicing retentions. This is a product purpose, not approval for a particular contractor or evidence that the project owner accepted the proposed instrument.
Sources: Allianz Trade — Empreitadas e Fornecimentos, caução de reforço, consultado em 28/10/2026 ↗
Calculate cash flow without calling it a saving
Fictional exercise: three EUR 20,000 partial payments have assumed 5% retentions. That is EUR 1,000 each and EUR 3,000 cumulatively. This measures retained money, not bond pricing or the net benefit of replacement.
Compare costs, the secured amount and obligations that may remain with the policyholder. Do not simply subtract an advertised premium from the retained amount. Record when money might be made available: timing and amount are separate questions.
Prepare formal steps before relying on release
Gather the retention clause, affected payments, secured obligation, beneficiary and required replacement wording. Distinguish acceptance of a request, issue of an instrument and confirmation that money has been released. Beginning one stage does not complete the next.
RMACHADO can help prepare a surety quote using relevant information. Assessment does not amend the construction contract or approve release of funds. If a deduction is disputed, keep the documents and seek specific clarification before treating it as improper.
KEEP THESE QUESTIONS
Your checklist for the next conversation
- Identify the basis and legal context of retention.
- List payments and amounts actually retained.
- Obtain replacement-security requirements.
- Distinguish request, issue, acceptance and release.
FROM THE ARTICLE TO YOUR SITUATION
Let us discuss your situation
Tell us what you want to protect. We review your request and help compare relevant terms. Requesting a quotation does not activate insurance.
Sources and transparency
Content updated on .
Consultation dates are stated in individual references when available.
Numerical examples are fictional and explain concepts. Editorial interpretations are identified in the text.
- Diário da República — Código dos Contratos Públicos, artigo 353.º, texto em vigor consultado em 28/10/2026 ↗
- Allianz Trade — Empreitadas e Fornecimentos, caução de reforço, consultado em 28/10/2026 ↗
Information from RMACHADO GROUP. This is not an insurance offer or individual advice. Covers, acceptance, exclusions, sums insured and costs depend on the policy. The intermediary does not underwrite the risks.