L S
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40% of the surety producer examination, and consist of around 20 questions.

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L S
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Chapter 3

Question 1 of 42

1

All surety bonds are considered a three party contract.

Select one of the following:

  • True
  • False

Explanation

Question 2 of 42

1

An insurance contract may not be formed as a two party contract between the
insurer and the insured.

Select one of the following:

  • True
  • False

Explanation

Question 3 of 42

1

There are __________ parties to a surety bond.

Select one of the following:

  • 0

  • 2

  • 1

  • 3

Explanation

Question 4 of 42

1

The parties to a surety bond consist of:

Select one of the following:

  • Principal

  • Obligee

  • Surety

  • All of the above

Explanation

Question 5 of 42

1

________ is the party in a surety bond that the bond is being posted for

Select one of the following:

  • Principal

  • Obligee

  • Surety

  • All of the above

Explanation

Question 6 of 42

1

_______ is one who with the principal is liable for the conditions of the contract
to the obligee.

Select one of the following:

  • Principal

  • Obligee

  • Surety

  • All of the above

Explanation

Question 7 of 42

1

________ is the party in the surety bond whom the future action is guaranteed.
dealing with risk as it occurs; often consumers will pay a higher deductible.

Select one of the following:

  • Principal

  • Obligee

  • Surety

  • All of the above

Explanation

Question 8 of 42

1

Both the principal and surety may be considered an obligor in the scope of a
surety bond, or one whom is responsible to the obligee.

Select one of the following:

  • True
  • False

Explanation

Question 9 of 42

1

________ is a type of surety bond that guarantees contracts are fulfilled.

Select one of the following:

  • Judicial bond

  • Fiduciary Bond

  • Permit bond

  • Contract Bond

Explanation

Question 10 of 42

1

_________ is a debt secured by a bidder for a construction job or similar type of
bid-based selection process for the purpose of providing a guarantee to the project
owner that the bidder will take on the job if selected.

Select one of the following:

  • Maintenance bond

  • Bid bond

  • Performance bond

  • Payment bond

Explanation

Question 11 of 42

1

________ is issued to one party of a contract as a guarantee against the failure of
the other party to meet obligations specified in the contract. Guarantees action!

Select one of the following:

  • Maintenance bond

  • Bid Bond

  • Performance Bond

  • Payment Bond

Explanation

Question 12 of 42

1

________ is a surety bond posted by a contractor to guarantee that its
subcontractors and material suppliers on the project will be paid.

Select one of the following:

  • Maintenance Bond

  • Bid Bond

  • Performance Bond

  • Payment Bond

Explanation

Question 13 of 42

1

_______ ensures a contractor will either correct any defects that arise or that the
owner is compensated for those defects..

Select one of the following:

  • Maintenance Bond

  • Bid Bond

  • Performance Bond

  • Payment Bond

Explanation

Question 14 of 42

1

The purpose of a license or permit bond is to guarantee a municipality or public
body that the individual seeking the license or permit will uphold all laws
pertaining to the issuance of the license or permit.

Select one of the following:

  • True
  • False

Explanation

Question 15 of 42

1

A financial bond in regards to a license or permit bond does not guarantee the
obligee that all monetary obligations faced will be paid to the obligee.

Select one of the following:

  • True
  • False

Explanation

Question 16 of 42

1

An indemnity bond in regards to a license or permit bond does not protect the
obligee from any loss caused by a breach of the obligors’ responsibilities.

Select one of the following:

  • True
  • False

Explanation

Question 17 of 42

1

A public official bond guarantees the honesty and faithful performance of a public
official's duties as prescribed by law or regulation, including the honest account of
all monies entrusted to the official according to the law.

Select one of the following:

  • True
  • False

Explanation

Question 18 of 42

1

_______ is a type of surety bond that is required by law and statute; state code
and law mandate this type of public official bond.

Select one of the following:

  • Voluntary Bond

  • Statutory Bond

  • Common Law Bond

Explanation

Question 19 of 42

1

_______ is a surety bond that covers the obligations that may not be explicitly
stated in a statutory bond, or covers a greater amount than the minimum required
by the statutory bond.

Select one of the following:

  • Voluntary Bond

  • Statutory Bond

  • Common Law bond

Explanation

Question 20 of 42

1

______ is entered into by the own freewill of the public official seeking the bond.

Select one of the following:

  • Voluntary

  • Statutory

  • Common Law

Explanation

Question 21 of 42

1

_______ is granted to a public official on a one-person basis.

Select one of the following:

  • Position Schedule Bond

  • Individual Bond

  • Name Schedule Bond

Explanation

Question 22 of 42

1

______ is a type of bond that allows for coverage of all employees named in the
bond. Any individual whose name is not contained within the bond will not be covered.

Select one of the following:

  • Position schedule bond

  • Individual bond

  • Named schedule bond

Explanation

Question 23 of 42

1

_______ covers loss as prescribed in the bond based on the position held to a set
coverage of liability.

Select one of the following:

  • Position schedule bond

  • Individual bond

  • Named schedule bond

Explanation

Question 24 of 42

1

A brief explanation of a judicial bond may be interpreted as any surety bond posted to
the courts in order to guarantee the courts a future action.

Select one of the following:

  • True
  • False

Explanation

Question 25 of 42

1

________ is required before the court can seize a person’s property to secure a
judgment.

Select one of the following:

  • Counter replevin bond

  • Garnishment bond

  • Attachment bond

  • Replevin bond

Explanation

Question 26 of 42

1

______ occurs when money or property belonging to a plaintiff has been attached to
while in the hands of a third party,.

Select one of the following:

  • Counter replevin bond

  • Garnishment bond

  • Attachment bond

  • Replevin bond

Explanation

Question 27 of 42

1

______ is a bond required by the court for any party who is suing another party to
secure possession of property that they believe they have a legal right to.

Select one of the following:

  • Counter replevin bond

  • Garnishment bond

  • Attachment bond

  • Replevin bond

Explanation

Question 28 of 42

1

______ may be purchased to regain possession of the property that was originally
obtained by the replevin bond.

Select one of the following:

  • Counter replevin bond

  • Garnishment bond

  • Attachment bond

  • Replevin bond

Explanation

Question 29 of 42

1

______ is a three party contract between a defendant, surety, and the courts that will
guarantee the court the future appearance of a defendant at all required court proceedings
until a disposition is rendered.

Select one of the following:

  • Stay of execution bond

  • Release attachment bond

  • Bail bond

  • Appeal bond

Explanation

Question 30 of 42

1

_____ guarantees payment of an amount due under an execution.

Select one of the following:

  • Stay of execution bond

  • Release attachment bond

  • Bail bond

  • Appeal bond

Explanation

Question 31 of 42

1

________ is a bond posted to suspend the courts decision until a higher court affirms
or denies the original courts decision.

Select one of the following:

  • Stay of execution bond

  • Release attachment bond

  • Bail bond

  • Appeal bond

Explanation

Question 32 of 42

1

______ guarantees for the payment of any judgment that may be rendered against
him/her in the action, after the plaintiff has secured an attachment bond.

Select one of the following:

  • Stay of execution bond

  • Release attachment bond

  • Bail bond

  • Appeal bond

Explanation

Question 33 of 42

1

______ is required by the courts to guarantee payment of court costs such as clerk,
sheriff, and administrative fees associated with the handling of a particular court case.

Select one of the following:

  • Discharge mechanics lien

  • Injunction bond

  • Cost bond

  • Dissolve injunction bond

Explanation

Question 34 of 42

1

_________ results from a court order, whereby a party is required to do, or to refrain
from doing, certain acts.

Select one of the following:

  • Discharge mechanics lien

  • Injunction bond

  • Cost bond

  • Dissolve injunction bond

Explanation

Question 35 of 42

1

________ may allow the defendant to proceed as if an injunction had never been
issued.

Select one of the following:

  • Discharge mechanics lien

  • Injunction bond

  • Cost bond

  • Dissolve injunction bond

Explanation

Question 36 of 42

1

________ allows the owner of property to sell the property, and guarantees to the
claimant of the lien any payment that is still due to them with interest and cost.

Select one of the following:

  • Discharge mechanics lien

  • Injunction bond

  • Cost bond

  • Dissolve injunction bond

Explanation

Question 37 of 42

1

A fiduciary bond is a legal instrument that essentially serves as insurance to protect
beneficiaries, heirs and creditors when a fiduciary fails to perform honestly or
competently.

Select one of the following:

  • True
  • False

Explanation

Question 38 of 42

1

A court may require a fiduciary bond for any person or party that has fiduciary duty
or responsibility to another.

Select one of the following:

  • True
  • False

Explanation

Question 39 of 42

1

An equity bond is a method of linking your investment to the stock market without
the risk of losing any money if stock markets go down.

Select one of the following:

  • True
  • False

Explanation

Question 40 of 42

1

________ is a bond that guarantees protection of the public health, safety and
welfare, during and after mining operations, and guarantees the restoration of land to its
previous state of being.

Select one of the following:

  • Customs bond

  • Self-insured bond

  • Reclamation bond

Explanation

Question 41 of 42

1

_________ ensures that money is available to pay its obligations under the workers
compensation law and any rules and regulations issued thereafter.

Select one of the following:

  • Self-insured bond

  • Reclamation bond

  • Customs bond

Explanation

Question 42 of 42

1

_________ is a guarantee from a surety company to the United States government
that the principal (importer) will abide by all laws and regulations governing the
importation of merchandise into the United States.

Select one of the following:

  • Customs bond

  • Self-insured bond

  • Reclamation bond

Explanation