Name: c (6) Explain the difference between a bond and insurance co ee the (6) Ex

Question

Name: c (6) Explain the difference between a bond and insurance co ee the (6) Explain the difference between a performance bond and a payment bond. and d. Contracting (24 points) sucontnaors, (olons, wnedl material igainst ar a. (3) What is a contract amendment? ls it issued before or after contract award?ic uita 6) Which of the following elements are necessary to make a valid contract? Circle all Mutual assent X Consideration v Capacity to carry out the task y Notarization um of owners, contractors and engineers? (3) Which of the following standard contract forms were jointly developed by a c. AIA V ii. AGC . All of the above (6) Indicate which party is responsible for the following project activitics. O (Owner), A (Architect/Engineer), C (Contractor). d. -Pay for the project CObtains permits and licenses Prepares contract specifications Evaluates siting options Determines contract type C Controls quality & cost e. (6) Place an C (Cost Plus Contract) or F (Fixed Price Contract) in the blanks to match the type of construction contract with the stated conditions C Easiest to admin & control; lowest risk for owner Cost of time & materials are known & fixed C Use when design & quantities are not known Slowest to award, requires a bidding process Scope & quantities are fully known Easiest to award quickly: highest risk for owner

Explanation / Answer

Part c

(1)

Insurance is a form of risk management, a loss management, which may or may not occur. It is a two-party contract between the insured and the insurance company. The insurance policy assumes a guaranteed promise that the insured will be compensated by the insurance company in the case of a covered loss.

A Surety bond is a contract among at least three parties. It is issued by a surety company on behalf of a second party known as the principal. This contract guarantees that the second party will complete an obligation to a third party known as the obligee. If the obligation is not met, the third party can recover its losses from that bond.

(2)

Insurance is designed to protect the insured from a loss such as an injury to an animal in your care or against third party bodily injury, i.e. a dog bite. A Surety Bond is designed to protect the obligee that has entered into a contract with a second party.

(3)

Insurance: Losses are expected and insurance rates are adjusted to cover losses depending on many factors. Surety Bond: There is a gaurantee in bond, losses do not occur.

(4)

Insurance: The premium paid is designed to cover potential losses the insured may incur. Surety Bond: The premium paid is to guarantee the principal fulfills his obligation.

Part (d)

Both of performance bond and payment bonds are generally issued in the public construction projects. The difference between the two is that a performance bond is issued to the owner of the project, while contractor do not have much rights in it. A performance bond assures the satisfactory performance of the terms of project.

On the other hand a payment bond is issued by a contractor and benefits are subcontractors, laborers and material suppliers. It insures that they will get paid for the services and materials they provide for the finishing of the project.

Related Questions

Navigate

• Browse (All)
• Browse N
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.