Risk Management and Allocation Flashcards
7 cards from real DBIA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Management and Allocation flashcards as text
In design-build, which risk allocation principle holds that risks should be assigned to the party best able to control and manage them?
Answer: Equitable risk sharing
Equitable risk sharing means risks are allocated to the party best positioned to control, manage, and mitigate them.
A design-build contract includes a differing site conditions clause. Which category covers conditions materially different from those indicated in the contract documents?
Answer: Type I conditions
Type I differing site conditions are those materially different from what is indicated or reasonably inferable from the contract documents.
When the design-builder assumes design liability in a lump-sum contract, which insurance product specifically covers errors and omissions in the design?
Answer: Professional liability (E&O) insurance
Professional liability (Errors & Omissions) insurance covers claims arising from design mistakes or negligence by the design-builder.
Which risk response strategy involves the design-build team negotiating a contingency allowance within the contract price?
Answer: Risk retention
Risk retention with a contingency allowance means the team accepts known risks and budgets for them rather than eliminating or transferring them.
Under DBIA best practices, who is primarily responsible for developing the risk register during the pre-award phase?
Answer: The design-build team collaboratively
DBIA best practices emphasize collaborative development of the risk register by the entire design-build team during pre-award.
An owner includes a 'no damage for delay' clause in a design-build RFP. What risk does this clause primarily transfer to the design-builder?
Answer: Schedule delay cost risk
A 'no damage for delay' clause transfers the financial risk of schedule delays caused by the owner to the design-builder.
In a design-build project, which document best serves as the primary vehicle for defining the boundary between owner-retained risks and design-builder risks?
Answer: The Request for Proposal and resulting contract
The RFP and resulting contract are the foundational documents that legally define which risks each party retains or assumes.