AFSB 151 Practice Exam Questions | 216 Questions with 100% Correct Answers | Verified | 42 Pages
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Course
AFSB 151
Institution
AFSB 151
Which one of the following characteristics is unique under American personal suretyship
compared with corporate suretyship? - Sureties were protected by laws that were favorable to
them
Except in the case of a forfeiture bond, if the principal defaults the surety will pay - Up to the
bond penal...
AFSB 151 Practice Exam Questions Which one of the following cha racteristics is unique under American personal suretyship compared with corporate suretyship? - ✔✔Sureties were protected by laws that were favorable to them Except in the case of a forfeiture bond, if the principal defaults the surety will pay - ✔✔Up to the bond penalty, but no more than the obligee's actual loss amount CB Construction entered into a construction contract with Lee Properties. The contract required that CB Construction obtain a performance bond, with Lee Properties named as the obligee. Performance bonds guarantee that the obligee will be indemnified for any loss resulting from the principal's failure to perform the work - ✔✔According to the contract, plans, and specifications; at the agreed price; and within the time allowed Which of the following groups, for the most part, serves the market for fidelity and surety bonds in the United States? - ✔✔Multiline property -casualty insurers Which one of the following is an example of a third -party beneficiary on a given bond? - ✔✔An heir on a fi duciary executory bond Bonds under this classification guarantee that the principal will properly account for and remit government funds collected as required. Which license and permit bond classification is described? - ✔✔Tax or fee bonds The two basic types of surety bonds that are written today are - ✔✔Contract surety bonds and commercial surety bonds A basic type of bond that involves all situations in which sureties guarantee performance of obligations that generally do not arise from contract is - ✔✔Commercial surety bonds When evaluating a surety claim, claims representatives are often assisted by outside legal counsel. Which one of the following other professionals often assist claims representatives? - ✔✔Engineers The surety bond three -party re lationship, the party who guarantees fulfillment of the obligation and who will either perform the obligation or pay the costs for its fulfillment is the - ✔✔Surety Paul has the legal responsibility for the care for his brother, who is a legally incompete nt person, and for his brother's property. Paul is required to obtain a bond that guarantees he will exercise his duties faithfully and account for all property received. This bond is called - ✔✔A fiduciary bond A person who commences an action against another to obtain an equitable remedy may be required to post a bond before the court will proceed with the action. This bond is called - ✔✔A plaintiff bond Bonds for which the laws specify the bond conditions and for which all three parties are dictated by the applicable law rather than the bond provisions are - ✔✔Statutory bonds A surety bond is a written document in which one party guarantees a second party's - ✔✔Performance to a third party for the second party 's failure to fulfill an obligation Unless the cosureties limit their respective liabilities in a bond, when two or more cosureties execute a bond with the same principal, their liability to the obligee is - ✔✔Joint and several A group that educates the general public, legislative bodies, contractor associations, and others about the benefits of surety bonds is - ✔✔The National Association of Surety Bond Producers (NASBP) A surety's liability for a surety bond can only cease to exist when the underlying obligation/agreement has - ✔✔Been performed as specified in the contract or when the bond has been canceled Because most bonds are "joint and several liability" documents, the obligee can recover losses from - ✔✔The principal or the surety, or from both The Miller Act was passed to require principals, in addition to furnishing a performance bond, to furnish a separate payment bond guaranteeing payment of all bills incurred by the contractor - ✔✔For labor and materials at the project completion for all fed eral jobs Judicial bonds - ✔✔Are a category of court bonds that arise out of litigation and are posted by persons seeking or appealing a remedy in court Bond losses occur when a fiduciary and its surety are held accountable because the fiduciary did not exercise reasonable care in notifying all heirs of an impending probate proceeding. This fiduciary is called - ✔✔An administrator In accordance with a contract to build a county shed for the Village of Malcolm, Raymone Construction purchases a contract su rety bond from SureRite Insurance. Identify the principal, obligee, and surety in this suretyship. - ✔✔Principal - Raymone Construction; obligee - Village of Malcolm; Surety - SureRite Insurance In an unlimited cosurety arrangement, the obligee can collect - ✔✔The full loss from any of the cosureties up to the penal sum of the bond
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