AFSB 152 Exam Questions and Answers
100% Solved
What does the premium to surplus ratio indicate? ️️o Can show how much the capacity has
to withstand underwriting miscalculations
o More premiums written, the higher the ratio, and more cause for concern
o Underwriting/investment losses cau...
AFSB 152 Exam Questions and Answers 100% Solved What does the premium to surplus ratio indicate? ✔️✔️o Can show how much the capacity has to withstand underwriting miscalculations o More premiums written, the higher the ratio, and more cause for concern o Underwriting/investment losses cause a decrease in policyholders' surplus, and causes increase in ratio Suretyship ✔️✔️An obligation to pay the debts of, or answer for the default or miscarriage of another Benefits to Project Owners ✔️✔️Prequalification of contractor performed by surety Lower prices from subcontractors because there is a guarantee they will be paid in full Lenders are more confident in extending project financing in the form of construction loans when they know that the construction risk has a surety's guarantee Benefits to Contractors ✔️✔️Backing of a prequalified corporate surety Surety credit can enhance a contractor's competitive position in private work What do construction managers do? ✔️✔️§ Facilitate design and construction processes such as: · Design and build methods · Project financing · Contractor selection · Bidding process · Scheduling · Maintenance of the structure once substantial completion is achieved What does a civil engineer do? ✔️✔️· Determine the size and consistency of foundations, the need for sheet piling, the design of reinforcing bars inside concrete foundation and similar matters · Determine the size and characteristics of the steel or masonry walls that carry the weight of the structure What do electrical engineers do? ✔️✔️· Determine the voltage and amperage loads required by heating, ventilating, and air conditioning units, as well as lighting requirements · Consider specialized electrical machinery or equipment, such as elevators, computers, or manufacturing apparatus What do mechanical engineers do? ✔️✔️· Deal with heating, ventilating, and air conditioning, contemplating such factors as the building's use and the type of equipment to be installed What is the design process? ✔️✔️§ Design professional interviews client and measures current and future needs § Design pro reviews existing facilities for potential renovation and for their ability to handle future growth needs § Professional engineers, architects, and attorneys obtain required zoning approvals and ensure that plans and specifications comply with all government regulations § For new construction, the future owner either acquires or obtains an option to acquire the land or the building to be renovated § The owner obtains a building permit, which may be subject to restrictions for zoning approval, parking, sewer access, utilities, labor and industry approval, environmental impact studies, and other restrictions § The owner arranges financing before construction Benefits of Design/Build Contractors ✔️✔️§ Reduced costs because the owner des not pay a design fee in addition to the construction overhead and profit § Reduced planning time because delays in communication among design professionals, contractors, and the owner are eliminated § Reduced costs because of the contractor's experience with and knowledge of the costs associated with various construction techniques and materials Drawbacks of design/build contractors ✔️✔️§ Most DB contractors don't have design professionals on staff · If government regulations require a pro engineer's or registered architect's seal on plans before, they must take extra steps § Most do not have errors and omissions insurance for design problems What should the contractor and surety look into about the owenr? ✔️✔️Make sure that the owner has the funds to pay for the job Construction mortgage ✔️✔️- Loan the provides financing during the construction period - Owner usually pays interest on the funds borrowed but makes not principal payment Permanent Mortgage ✔️✔️- Loan that provides financing after the work is completed · Payments to the lender include both interest and principal, and the mortgage is expected to be in effect for a number of years Can a lender be named on the bond as an additional obligee? ✔️✔️Yes What must be true about design plans for competitive bidding to work best? ✔️✔️design pro has prepared plans that are accurate, complete and thoroughly understood by prospective bidders What must the contractor do in the bidding process if the design plans have gaps? ✔️✔️§ contractors must bid higher to compensate for omissions or owner must pay more through change orders to cover unforeseen expenses How many general contractors work on a project? ✔️✔️o Owner can have one general contractor for entire project or separate GC's for certain aspects of the job (electrical, special equipment such as elevators, structural) What must the contractor do once awarded the contract? ✔️✔️o Once the owner awards the project to a contractor the contractor must execute the contract and provide any required bonds, present certificates of insurance to the owner, and, if required, obtain builders risk property insurance What are the steps in mobilization? ✔️✔️§ The process before construction begins that involves initial activities to facilitate a construction process, such as moving equipment and a field office onto the job site and installing temporary utilities § During mobilization, the GC's purchasing department selects material suppliers and subcontracts and converts bids into written contracts or purchase orders § GC obtains delivery dates from suppliers and verifies subs availability to start work § Contractor may have to obtain building and utility permits Critical Path Method ✔️✔️§ A process that identifies every major element of the construction project, as well as a time estimate for each element, and assembles these elements into one master schedule Punch List ✔️✔️§ A list of small finishing tasks that must be accomplished for completion § Put together by the owner when the project has reached substantial completion General Building Contractors ✔️✔️o An independent contractor who obtains primary contract for project and either completes all the work or subcontracts out a portion (or all) of the work to other independent contractors who specialize in such work § Responsible for the coordination of the entire project o Owner may award most of the project to a general contractor but contract separately for plumbing, electrical, etc
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