Description

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This seminar is a wide-ranging examination of insurance-related issues connected to bonding in the construction industry.  The approach of the seminar is to educate insurance professionals first and foremost about the various legal relationships in the typical commercial construction contract.  This includes a discussion of the design-bid-build methodology and also the construction management methodology for commercial construction contracts.  A brief review of the design-build method of construction is also included. 

The next section of the seminar is a brief review of the American Institute of Architects’ contract forms, as well as those promulgated by the Associated General Contractors. 

The seminar then turns to the core topic by looking at bonding basics.  The conceptual distinction between a bond and insurance is explained and the major terminology is also reviewed.

From there, the seminar turns first to bid bonds.  The major industry form is addressed, as is the statutory background against which most bid bonds operate.  Producers are educated on how to move swiftly in the event there is difficulty at this preliminary stage of the construction project.

The next hour is devoted to the specifics of the performance and payment bond, including a review of the form language, who is eligible to make a claim, and how the bond functions in the real world.

A substantial portion of the third hour is devoted to defaults: what happens when a contractor or the project gets into financial difficulty?  Much of the emphasis here is on how producers can readily assist troubled contractors and the companies who bonded them, with a view toward avoiding potential errors and omissions liability.  Consistent with this, a separate section is devoted to the general agreement of indemnity, due to difficulties it can cause in insured-producer relations.

The seminar concludes with a brief look at hot topics in bonding.  This section includes public-private partnerships.  It also touches briefly on the distinction between fidelity bonds and construction bonds by using ERISA bonding as an example of the scope of coverage.

Approved for 3 NJCE Credits