Nevada Contractor License Exam — All Questions
2 questions
A surety bond required of a Nevada contractor differs from ordinary insurance in what key way?
- a.It transfers the contractor's own risk with no repayment obligation
- b.It is a three-party arrangement, and if the surety pays a claim the contractor must reimburse the surety✓
- c.It covers the contractor's own employees for on-the-job injuries
- d.It is legally identical to a general liability policy
A surety bond is a three-party guarantee among the principal (contractor), obligee (the party protected), and surety. If the surety pays a claim, the contractor must reimburse it. Insurance is a two-party contract that transfers the insured's own risk with no repayment.Construction Business & Law Manual for Nevada (surety bonds vs. insurance)
Which coverage must a Nevada contractor that has employees carry?
- a.No coverage is required in Nevada
- b.Industrial insurance (workers' compensation) covering its employees✓
- c.Flood insurance on every jobsite
- d.A life insurance policy on each worker
Nevada requires employers, including contractors, to carry industrial insurance (workers' compensation) for their employees. Proof of coverage is a condition of licensure, and working without it exposes the contractor to penalties and stop-work action.NRS Chapter 616B (industrial insurance / workers' compensation)