AFSB 151 Final Exam

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AFSB 151 Final Exam A surety bond is a written document in which one party guarantees a second party's - ✔✔Performance to a third party for the second party's failure to fulfill an obligation. ... Which one of the these groups, for the most part, serves the market for fidelity and surety bonds in the United States? - ✔✔Multiline property-casualty insurers Sureties use what written document to authorize a producer to act as the surety's agent in bond production? - ✔✔A power of attorney While suretyship and banking both use a prequalification process to extend credit to their customers, suretyship is different from bank credit in that - ✔✔Suretyship guarantees performance as well as monetary obligations. Because most bonds are "joint and several liability" documents, the obligee can recover losses from - ✔✔The principal or the surety, or from both. A financial guarantee differs from performance and fidelity guarantees because it requires honesty, the ability to perform the contract, and - ✔✔The ability to pay money to meet the contractual obligation. A legal remedy that a surety can use against a defaulting bond principal, in which the surety exercises its right to force the principal to perform by exhausting the principal's resources instead of its own, is - ✔✔Exoneration In an unlimited cosurety arrangement, the obligee can collect - ✔✔The full loss from any of the cosureties up to the penal sum of the bond. A bond that guarantees that faulty work will be corrected and defective materials will be replaced for a period of one year or less and that is usually provided with a performance bond at no additional cost is a - ✔✔Maintenance bond A contract bond that guarantees the local government [Show More]

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