Industry Risk Issues

Below are resources on various risk management topics.

Please note that the opinions expressed in articles and other materials linked on this page are those solely of the author(s) and do not necessarily represent the opinions of NASBP.

CONTRACTORS' RISK MANAGEMENT AND INSURANCE

1. Snakes in the Grass: Understanding Contractors' Risk Management and Insurance
This article discusses the issues that present undue risk to the client’s bottom line or to that of the surety and is based on a session that was presented at the April 2007 NASBP Annual Meeting.

SUBCONTRACTOR DEFAULT INSURANCE

Below are various resources on the topic of subcontractor default insurance (SDI).

RISK ISSUES IN BOND FORMS AND PROJECT AGREEMENTS

1. Beware of Inadequate or Fraudulent Surety Bonds This article, coauthored by NASBP's General Counsel and Director of Government Relations, Mark H. McCallum, and SFAA’s General Counsel, Edward G. Gallagher, is reprinted with permission from a special advertising section in Engineering News-Record. Here is a link to the full ENR Surety Supplement http://www.sio.org/pdf/enr09.pdf

2. Know Your Bond Before You Sign This article, coauthored by NASBP’s General Counsel and Director of Government Relations, Mark H. McCallum, and SFAA’s Director of Underwriting and Assistant Counsel, Robert J. Duke, provides insight to terms of a bond form, such as language that triggers the surety's liability, varies the burden of proof, increases the surety's monetary liability beyond the original penal sum of the bond, limits the surety's response options, and lengthens the time the surety remains liable. This article was published in the November 2008 issue Construction Business Owner magazine.

3.  Contract Terms and Conditions from a Surety Perspective This article, coauthored by NASBP’s General Counsel and Director of Government Relations, Mark H. McCallum, and SFAA’s Director of Underwriting and Assistant Counsel, Robert J. Duke, describes how a surety company typically reviews the terms of a construction contract to determine its exposure under a performance bond. This article was published in the June 2008 issue Construction Business Owner magazine.

4. Getting Directly to the Point of the Contested Matter: Dispute Mitigation & Resolution in ConsensusDOCS Construction Forms This article, written by the NASBP's General Counsel and Director of Government Relations, Mark H. McCallum, describes how the ConsensusDOCS forms use a multi-method, graduated approach to defuse project disputes and how their approach precludes a role for the project design professional as initial arbiter, a point of departure from other industry standard form families. The article was published by the American Bar Association's Fall 2008 Forum on the Construction Industry. 

5. Adding Value: Identifying Critical Risk Issues in Bond and Project Agreements
This article discusses the provisions of bond forms that disadvantage the surety relationship and summarizes the contract documents being published by the major industry documents programs. This information is based on a session that was presented at the April 2007 NASBP Annual Meeting. NASBP is a participant in the development of ConsensusDOCS™, a library of more than 70 industry standard form documents. Click here for more information about ConsensusDOCS™ and about purchasing the ConsensusDOCS™ documents with the NASBP discount.

SUSTAINABILITY AND GREEN BUILDING LAWS

Below are various resources on the topic of sustainability and green building laws containing surety bonding requirements.

ABA Forum (Adobe PDF File)
McCallum Duke (Adobe PDF File)
Getting Directly (Adobe PDF File)
Know Your Bond Before You Sign (Adobe PDF File)
ENR Fraudulent Bonds (Adobe PDF File)