As we all know, accidents such as delay in construction period, theft, explosion and collapse of construction machinery and building materials are common occurrences, and the causes of these accidents are engineering risks related to the project. At present, there are many ways to reduce the project risk as much as possible and achieve the expected goal of the project. Project guarantee and project insurance, which belong to paid risk transfer, are two common ways.
1 project guarantee
1. 1 project guarantee concept
1. 1. 1 guarantee and its way guarantee is a credit behavior that the guarantor guarantees the creditor's rights in a certain way. There are five ways of guarantee: guarantee, mortgage, pledge, lien and deposit, among which only the guarantee is aimed at specific material creditor's rights, such as engineering projects. Its characteristic is to ensure performance first, and then consider compensation for economic losses. The other four are claims against money and property, which only bear economic compensation and cannot guarantee performance.
1. 1.2 guarantee and project guarantee guarantee is a kind of credit behavior that the guarantor assures the creditor that when the insured fails to complete (or fails to complete) the obligations or commitments stipulated in the contract, the guarantor will complete the contract or pay other forms of compensation on his behalf. Engineering guarantee is a credit behavior to assure creditors that the insured will fulfill the contractual obligations on the basis of evaluating the performance and credit of the insured in advance.
1. 1.3 engineering guarantee function
First of all, it can effectively form an access system for the engineering construction market, because as a credit mechanism, guarantee will strictly examine the situation of the insured and keep the unqualified insured out of the market. This is the process of optimizing resource allocation. Secondly, it can effectively regulate the behaviors of project participants, restrain and regulate the behaviors of all participants, effectively eliminate administrative intervention, and prevent violations of laws, regulations and disciplines through counter-guarantee (the guarantor proposes to the insured as a condition of issuing a letter of guarantee in order to reduce risks, and the insured will pay extra compensation when the guarantor suffers losses). Third, it is conducive to safeguarding the fundamental interests of all parties fairly, not only ensuring the interests of the owners, but also enabling the contractor to dispel the worries of defaulting on the owners.
1.2 main engineering guarantee varieties
1.2. 1 bid bond is the guarantee that the guarantor follows the principles of equality, voluntariness, fairness, honesty and credibility, and after reviewing the bidder's bidding qualification, makes a guarantee to the owner that the bidder is qualified and capable of bidding and can perform normally according to the requirements of the owner.
1.2.2 Performance guarantee This guarantee is only for the contractor. It is the guarantor's guarantee to the owner that the contractor can abide by all the terms of the contract and fully perform all the responsibilities stipulated in the contract after evaluating the contractor's performance, credit and performance ability.
1.2.3 Payment guarantee This guarantee is only for the owner. It is a guarantee made by the guarantor to the contractor after evaluating the credit and payment ability of the owner to ensure that the owner pays all the money according to the contract.
1.3 project guarantee status
The historical evolution of 1.3. 1
Project guarantee started late in China, and was mainly used for foreign investment and joint venture projects in the early 1980s. With the promulgation of 1 June 30th, 1995 and1March, 1998,1July, 1998, the state approved the establishment of the first joint-stock commercial Changan guarantee company (mainly providing guarantees in engineering, quality, credit and housing). Cooperate with the World Bank and ADB in several development projects (in the National Grand Theatre, Zhongguancun development and other mega projects, the accident rate is very low, 100% is distributed according to quality). Therefore, the state is determined to cultivate a number of powerful guarantee companies.
1.3.2 Market Scale In today's economic globalization, especially after China's accession to the WTO, the national economy has developed continuously, healthily and rapidly, and the construction industry is no exception. In 2004, the construction investment was more than 5 trillion yuan, and there were 35 million employees in the whole construction industry, accounting for a quarter of the global counterparts. Therefore, the market prospect of engineering guarantee is very considerable.
Problems in 1.3.3
First of all, laws and regulations need to be improved and perfected. Some owners don't want to find a guarantor to guarantee because of the high cost. Because commercial professional guarantors make profits by providing guarantee business, such guarantors usually charge higher guarantee fees and reduce guarantee risks through decentralization. They usually have a deeper understanding of the project and have stronger confidence in the guarantee risk than others. At the same time, it will also affect the level of guarantee rate. Similarly, many contractors are reluctant to find a guarantor to guarantee, because after asking, some aspects leave less room for themselves. Moreover, the contract law stipulates that the signing of the contract should be voluntary by both parties, and the guarantee contract cannot be signed by force. In addition, there is no provision for this expenditure in the accounting system. Therefore, the urgent problem to be solved at present is to enforce the project guarantee through legislation. Second, the subject behavior needs to be standardized. In particular, the behavior of the government as the main body needs great efforts to regulate. In today's market economy, many civil servants can't resist the temptation of interests, corruption, desperate, unable to restrain their illegal behavior. Third, the behavior of the intermediary sector needs to be standardized. Some intermediary departments have uneven ideological and professional qualities and few outstanding personnel. We should set higher entry threshold, high standards and strict requirements for employees.
1.4 Some suggestions
The legislative procedure of 1.4. 1 is rigorous and complicated. Before its formal approval, some relevant management regulations and rules and regulations can be appropriately promulgated to clarify the scope of implementation of the project guarantee, at least in five types of public bidding projects (public infrastructure, public facilities, government investment projects, government chartered financing projects and foreign-funded projects).
1.4.2 The guarantee subjects should be banks, professional guarantee companies, non-bank financial institutions, insurance companies, etc.
1.4.3 letter of guarantee (a contract issued by a bank to set guarantee obligations or a letter of the same nature issued by a professional guarantee company, called a letter of guarantee) should be conditional and the debtor has the right of appeal. Don't choose an unconditional letter of guarantee, because as long as something goes wrong, the creditor will demand compensation, and the debtor will have no chance to appeal.
2 engineering insurance
2. 1 The concept of engineering insurance
2. 1. 1 insurance
Insurance means that the insured pays the insurance premium to the insurer according to the insurance contract. According to the contract, the insurer shall be liable for compensation insurance or payment of insurance money for the losses caused by the agreed accident.
2. 1.2 engineering insurance
Engineering insurance refers to the commercial behavior that all parties involved in the project insure the risks that may occur in the construction of the project with insurance companies, enjoy the risk management services provided by insurance companies, and get economic compensation after the risk accidents. The subject matter of engineering insurance is the object and object of the insured accident agreed in the engineering insurance contract, that is, all kinds of engineering projects and construction equipment with insurable interests and various civil liability.
2.2 Characteristics of engineering insurance
Engineering insurance is a kind of comprehensive insurance, which depends on the comprehensiveness of engineering risks. Engineering insurance is different from general property insurance and personal insurance, and its characteristics are as follows:
Engineering insurance is a kind of comprehensive insurance, which depends on the comprehensiveness of engineering risks. Engineering insurance is different from general property insurance and personal insurance, and its characteristics are as follows:
2.2. 1 The underwriting business is complex and requires high professionalism. When underwriting engineering insurance business, comprehensive knowledge of construction and installation engineering, insurance, mathematics and management is needed to analyze and estimate engineering risk, determine insurance premium rate, design insurance contract clauses and claim settlement business according to specific engineering projects. Therefore, the standard of insurance industry is very high.
2.2.2 The insurance amount of high insurance amount engineering insurance is determined on the basis of the value of the subject matter insured or the economic compensation liability borne by the applicant. The subject matter of the contract usually includes construction and installation works, construction equipment, appliances, building materials and the personal health and life span of on-site personnel. So the insurance amount is usually high.
2.2.3 There is information asymmetry in the field of engineering insurance. Information asymmetry is often manifested as information asymmetry between insurers and policyholders. Insurers have the advantage of insurance information, and get more benefits from the insurance premium paid by the insured by setting favorable contract terms. And the insured has the advantage of engineering information, because the risk situation in construction and installation is clear, they will try their best to insure the insurance that is beneficial to them.
2.2.4 Engineering insurance can be underwritten additionally, and besides the main insurance, it can also bear the liability of incidental insurance. For example, in installation engineering insurance, the insurance liability is mainly accidents such as overvoltage, arc and short circuit. , mainly for the risk of installation process, but the insurance liability of machine damage is also included in the loss caused by electrical reasons and included in the insurance policy of installation engineering insurance.
2.2.5 Personalization of key insurance clauses. The engineering risks of all kinds of projects have their particularity, so the contents of engineering insurance clauses cannot be the same. The contents of key insurance clauses need to be determined according to the specific conditions of the subject matter insured, so the engineering insurance clauses are personalized.
2.2.6 The insurance clauses can be changed. With the deepening of the construction progress and the changes of the internal and external environment during the construction process, the parties to the insurance contract can change the contract terms on the basis of consensus. For example, with the extension of the construction period, the insurance period can be extended, some construction equipment or projects will be added or reduced during the construction process, and the insurance items and insurance amount will be adjusted accordingly.
2.3 Basic functions of engineering insurance
2.3. 1 has three functions at the micro level. First, protect the interests of engineering contractors or subcontractors. Second, protect the interests of the owners. Third, to reduce the occurrence of engineering risks, insurance companies will not only promise to compensate losses within the scope of insurance liability, but also provide risk management guidance for policyholders in terms of disaster prevention and loss control from their own interests.
2.3.2 Macroscopically, it has four functions. First, after the introduction of engineering insurance mechanism in the field of engineering construction and installation, insurance companies naturally care about the cost and quality of engineering construction and the behavior of contractors, which is equivalent to introducing a third-party supervisor outside the owners and government departments, further promoting the standardization of the engineering construction and installation market. Second, developing the engineering insurance market, innovating the types of engineering insurance and perfecting the engineering insurance mechanism are conducive to perfecting China's financial system and promoting the development of related industries. Third, in foreign countries, engineering insurance has become a necessary condition for project investment and financing and bidding qualification. The perfection of engineering insurance mechanism also urges owners and contractors to actively invest in engineering projects. Fourth, after the project is insured, there will be no worries about bank loans and investors' investment, which can attract potential investors to the maximum extent.
2.4 Elements of Engineering Insurance Contract Management of engineering insurance contract is one of the cores of insurance practice of insurers and policyholders, and the engineering insurance contract includes three elements: subject, object and content.
2.4. 1 Subject refers to the person directly or indirectly related to the contract, including insurer, applicant, insured, beneficiary, insurance agent, insurance broker, etc. It is worth noting that in engineering insurance, the applicant and the insured are consistent and inconsistent, while in personal accident insurance, ten-year liability insurance and other liability insurance, the applicant and the insured are inconsistent.
2.4.2 The subject matter refers to the substantive problem to be solved by the subject of an insurance contract through insurance trading activities, that is, the insurable interest of the insured on the subject matter insured. The subject matter of insurance is inseparable from the insurable interest, and isomorphic becomes the object of the insurance contract. 2.4.3 The contents mainly include insurance contracts with construction in progress as the main subject matter of insurance. Followed by the insurance contract of liability insurance. Furthermore, it is an insurance contract for life insurance.
2.5 Main types of engineering insurance
2.5. 1 All Risks of Construction Project is an insurance that covers the losses (quality, construction preparation, all materials stored on site, etc.) suffered by the project itself. ), construction facilities, equipment and tools, existing buildings in the site, property parked in the site under the care or guardianship of the insured, and compensation for property losses and personal injuries caused to a third party due to construction. It is suitable for providing comprehensive guarantee for various engineering projects, with the completion price as the highest price. 2.5.2 The subject matter of all risks in installation engineering is similar to all risks in construction engineering, and it is also divided into two categories: material property and third party liability. It's just that the content of material losses is different. The material losses of installation engineering insurance include installation engineering, civil engineering (generally not included in the installation engineering, but can be insured in the installation engineering), site cleaning fees, equipment for installation engineering and other assets. The insured amount is the highest price of the transaction price.
2.5.3 Occupational liability insurance covers the losses caused to the owner or contractor by the design mistakes of engineering design and consulting enterprises or the work mistakes of consultants.
2.5.4 Ten-year liability insurance covers the losses caused to the owner by defects or hidden dangers of building materials in the main part of the contractor's construction within ten years from the date of completion acceptance. This kind of insurance is to ensure the quality, aiming at the characteristics of the contractor's mobility.
2.5.5 Accidental injury insurance is a kind of insurance to compensate the contractor's personnel for accidental injuries in the construction process, mainly for the payment of disability, death, medical expenses caused by accidental injuries and economic compensation for temporary loss of labor.
2.6 Status of Engineering Insurance
Since the late 1970s, engineering insurance has started to rise. However, apart from foreign-funded projects, domestic-funded projects are rarely carried out, only a few percent. China Development Bank and China People's Insurance Holding Company both undertake engineering insurance business, and China People's Insurance Holding Company is the largest and earliest company to carry out this business. At present, there are similar problems in the implementation of guarantee, that is, the absence of law and system affects its smooth development. Generally speaking, if you want to insure, it will inevitably lead to higher costs, and everyone is not active or even willing, and there is no mandatory requirement of corresponding laws and regulations. In addition, there is no corresponding accounting channel in the accounting system. Therefore, legislation should be made as soon as possible to provide legal protection for the implementation of engineering insurance. In addition, with China's accession to the WTO, foreign insurance companies will also enter the insurance market in China, and the competition will be more intense. The competition among domestic insurance companies will be more intense and even unfair, and this situation will not change immediately in the short term.
3 project guarantee and project insurance comparison
3. 1 both * * *
3. 1. 1 are all important means of risk transfer for paid projects.
3. The purpose of1.2 is the same, which is to ensure the realization of creditor's rights in the contract.
3. 1.3 The method is the same, including general guarantee (the guarantor may refuse to undertake the guarantee liability to the creditor before the dispute over the main contract has been tried or arbitrated and the debtor's property is enforced according to law) and joint liability guarantee (if the guaranteed debtor fails to perform his obligations at the expiration of the performance period agreed in the main contract, the creditor may require the debtor to perform his obligations, or the guarantor may undertake the guarantee liability within the scope of his guarantee without going through arbitration or court trial procedures).
3. 1.4 The term is the same, and the guarantee shall be given when the letter of guarantee or insurance policy is issued.
3. 1.5 is essentially a subordinate contract, which depends largely on the main contract of engineering contracting.
3.2 The two are different
3.2. 1 Engineering insurance with different risks is only for natural disasters, natural risks and physical risks that occur during project implementation. Project guarantee is only aimed at the risks caused by human (disaster), political and economic factors in project implementation.
3.2.2 Whoever pays for engineering insurance with different benefits will benefit. Project guarantee means that the insured does not benefit and the third party (creditor) benefits.
3.2.3 Engineering insurance with different risk responsibilities will not provide economic compensation for the insured. The project guarantee can be recovered from the applicant through counter-guarantee.
3.2.4 Engineering insurance with different insurance conditions has no restrictions on the insured, and there is no choice. Whoever pays for the insurance will buy it. The project guarantee strictly examines the applicant's situation and rejects those who are unqualified. Therefore, payment may not be guaranteed.
3.2.5 Different risks are expected. Engineering insurance is provided in the case of expected risks, that is, expected risks will occur. Project guarantee is a kind of guarantee given when there is no expectation of the risk, that is, I am sure that the risk will not happen and I firmly believe that I can perform the contract.
3.2.6 Engineering insurance with different purposes is a commercial economic behavior, which only pays attention to economic compensation. However, the following three situations will not be compensated: first, the risk accident caused by human factors; Second, political reasons lead to risk accidents; Third, risk accidents caused by economic reasons. Project guarantee is a kind of credit behavior, aiming at ensuring the performance and completion of the contract, and then considering the compensation for economic losses.
3.2.7 Impact on project cost Different project insurances have a great impact on project cost because there is no counter-guarantee fund guarantee. The project guarantee is guaranteed by counter-guarantee funds, and the premium is generally 1% ~ 3% of the guarantee contract price, which has little impact on the cost.
4 conclusion
In today's socialist market economy, any economic behavior must be regulated under the framework of laws and regulations, and honesty and trustworthiness are the minimum criteria. Abiding by the law, observing the law and punishing offenders are the necessary prerequisites and guarantees for maintaining a normal and orderly society and all economic activities. In recent years, there have been many phenomena in the field of construction engineering, such as "beard project", "unfinished building" and arbitrarily deducting the wages of migrant workers. This also strongly shows from the opposite side that it is necessary to establish, improve and popularize the market access mechanism of construction projects with interest constraints and credit guarantees mainly based on project guarantees, supplemented by project insurance, in order to safeguard the legitimate interests of all parties involved in the project, and at the same time, it should be in line with international practices as soon as possible and incorporate project claims into this framework. So as to create a good atmosphere for social investment, financing and operation and accelerate the virtuous circle of social capital.
[References]
Zhou Shengshi. Reflections on the implementation of engineering insurance and engineering guarantee in China [J]. Building Economy, 2000, (3): 18-20.
[2] Editorial Board of Certified Consulting Engineer (Investment) Examination Textbook. Analysis and Evaluation of Project Decision [M]. Beijing: China Planning Press, 2000.
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