MHIC NASCLA Contractors Practice Exam 2025 - Free Contractor License Practice Questions and Study Guide

Question: 1 / 400

What is the financial responsibility of a contractor when a claim is made against them from the Guaranty Fund?

Complete reimbursement and additional fees

The financial responsibility of a contractor regarding claims from the Guaranty Fund generally involves complete reimbursement and additional fees. This is structured to ensure that contractors maintain a high standard of accountability in their work. When a claim is filed against a contractor, if the claim is found to be valid, the contractor is required to not only pay back the amount that the Guaranty Fund disbursed to settle the claim, but they also must cover any additional fees associated with the processing of the claim.

This requirement serves two key purposes: it protects the interests of consumers and reinforces the importance of compliance and quality in contracting practices. By holding contractors financially liable for the full amount plus fees, it discourages negligence and encourages contractors to perform their duties with greater diligence.

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Just reimbursement of the principal amount

Only if the claim is substantiated

No financial responsibility

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