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NASCLA - Questions With Verified Answers
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NASCLA - Questions With Verified Answers
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NASCLA - Questions With Verified Answers Performance Bond Correct Ans - Guarantees that the contractor will complete a contract with in its time frame and conditionsPayment Bonds Correct Ans - Guarantees subcontractors and suppliers that they will be paid for work if they perform properly under a contract
Maintenance bond Correct Ans - Guarantees that for stated Typically one year no defective workmanship or material will appear in the completed project
Completion bond Correct Ans - Provide assurance to the financial backers have a construction project but it will be completed on time
Fidelity bond Correct Ans - Covers business owners for losses due to dishonest act by there employees
Lien bond Correct Ans - Guarantees that liens cannot be placed against
the owners property by contractors for payment of service
Sub contractors bond Correct Ans - Protects the general contractor in the event that subcontractors do not fully perform the contract and or pay for labor and materials
Bank letter of credit Correct Ans - Is not a Bond but is it cash guaranteed to the owner it is not a guarantee of performance but can be converted to a payment to the owner by a bank or lending institution
Bid bond Correct Ans - Guarantees that the contractor if awarded the job will do the work at the submitted bid price enter into a contract with the owner and furnish the required performance and payment bonds
What is a bond Correct Ans - Bonds provide protection in the event that the contractual obligation's are not met Bond language Correct Ans - At a minimum Bond should contain the total dollar amount length of the bond requirements for notice of the fact or lack of maintenance and bond enforcement
Filing procedures Correct Ans - Construction law contractual relationships govern the bond claims process the filing process as outlined in the bond
Project changes Correct Ans - Unless specifically outlined in the bonds agreement the Surety company will not cover changes to the original contract in most cases request for additional coverage must be made and the bonding company must be notified of the contract changes
Payment in the event of default Correct Ans - In the event of default Surety may provide additional finances arrange for a new contractor or hire subcontractors to complete the work or pay out the amount of the bond
Miller act of 1935 Correct Ans - Current law requiring performance and payment bond on a federal construction project value greater than $100,000
Miller act amounts Correct Ans - 50% on contracts less than 1 million 40% of contracts between one and 5 million 2.5 million payment bond for contracts in excess of 5 million
Little Miller act Correct Ans - Similar to the Miller act for public works projects
Construction Industry payment protection act of 1999 Correct Ans - Addendum to the miller act it's purpose is to improve payment bond protections for persons who furnish labor or material for use on federal construction projects to help subcontractors with adequate protection
All risk builders risk insurance Correct Ans - A form of property insurance that covers property owners and builders for buildings under construction
All risk coverage Correct Ans - Provides for Direct loss by these perils that are not specifically excluded by the policy it generally provides coverage
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