Subcontractor default insurance (“SDI”) — insurance that covers certain losses related to a subcontractor’s material breach of a subcontract — has been gaining in popularity over bonds among general contractors. However, for a number of reasons, sureties assert that bonds are better than SDI, despite the common complaint about bonds that sureties are slow to pay claims. The expedited dispute resolution (“EDR”) bond addresses that complaint by providing the coverage of a traditional bond with an abbreviated investigation and dispute resolution process. In my latest article for the Daily Journal of Commerce I address potential pitfalls of EDR bonds and advantages and disadvantages parties who use the bonds should carefully consider when deciding whether to use them. Read the full article here.
Originally published as “The sureties strike back: the expedited dispute resolution bond” on February 14, 2019, by the Daily Journal of Commerce.