Guarantee

1. A promise given with a high degree of commitment or certainty.

2. A commercial undertaking from a manufacturer to a consumer that a product or service will be of a specified quality for a stated time period.

3. A guarantee issued by a bank or other financial company backed by a financial sum of money in the event of a contractual breach. Examples of these types of guarantees are bid bonds and performance bonds.

4. A financially binding undertaking to be responsible for another’s promise to a third party.

For example, a parent may choose to stand guarantor their child’s student loan with a bank.

5. To underwrite through an insurance policy or other means a certain level of protection.

6. Monies or other assets held as a security to ensure another party honours their financial, legal, property, commercial or other undertakings.

7. A person who stands guarantor can be called a guarantee.

8. An adjective used to describe a promise given in respect of a financial instrument.

For example: “The return was a guaranteed return of inflation plus 2%.”

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