What is the construction contract type which decrease the client risk ? and why ?

Cost reimbursable type of contract has the highest risk for the Client as the final cost is not known. 

In my opinion, a lump sum type of contract with nature and scope of the works to be carried out properly defined, will decrease the client risk.

I think the model of "Cost of Reimburseable " is the best , because it will cover all the real cost is actually incurred by the implementation team work , in the absence of engineering , it's all receipts bills according to the specifications of goods , material, type, price, quantity , and so on .

Adhesion contractsContract compliance is the version of the conclusion of contracts formulas rely on the use of the model typical of the contract prepared by one of the parties to the contractual relationship individually and submit it to the other party who is not his only approve it as is or reject without having to change the terms contained therein or the terms and conditions contained in not to enter into Mjazbh or real bargaining on conditions with the party prepared for this decade, and this was described these contracts "to comply." It was said that he called the first of the French legal as well as Sally in the early twentieth century (1).    The most important element in these contracts, and Hua the one who made it is a sign of acquiescence, is the presentation of contract by the stomach on the other end as the San case he says, "I accept it as it is or leave it as is," which is said about him in English Take it-or Leave it "" . We say that this type of contract it is a sign of acquiescence, because they are not of adhesion contracts only if they contain conditions that the other party may accept them if given the freedom to bargain and then we can say Ptaab satisfaction in it. If the check for satisfaction which no longer The compliance of any description.

It is considered to be a low risk method of contracting for the client, as the contractor takes the financial risk for construction. However, if design information is incomplete at tender, or if significant variations are required after the contractor has been appointed, the cost to the client can be significant.  Construction is a confusing process governed by complicated contracts and involving complex relationships in several tiers. ... The third type of risk is design-related—the completed building does not meet the organization's needs. For example ..... Teamwork reduces friction, uncertainty, inefficiency, and duplication of effort.

Risk Sharing And Effective Incentives. 1177. The contractor in a fixed price contract is motivated to reduce the costs to the lowest practicable level and maximise profit. In bidding for work under fixed price contracts, rational bidding contractors will include a risk premium in their tender. The client pays this risk premium.

Understand progress payments and how to reduce problems in changing the contractors' scope of work. ... For example, if the price of oil significantly affects the costs of the project, the client can accept the oil price volatility risk and include a provision in the contract that would allow the contract price adjustment based on getting three prices and choosing the lowest with all the benefits.

Much of the incentive contracting literature suggests that incentive contracts can foster a balance of risk between clients ... into contracts and their likelihood of incentivising contractors to improve performance, reduce cost and suitably allocate risks. Structuring an effective incentive scheme can be complex due to the work involved.

Client has to share the processes, obligations and risks of a construction project with the parties, directly ... tractual resolutions serve the client's interest and how they help to reduce the risk of claims. Keywords: ... The type of the selected contracting –system and the tightly related contract determine the factors which are applicable.

Speculative risks are largely with the contractor, but can reduce according to the extent of the design input by the client. In terms of cost and time this is a relatively ... Construction management is a type of management procurement where the client appoints a design team and enters into an agreement with the construction.

On small activities that have a high uncertainty, the contractor might charge an hourly rate for labor, plus the cost of materials, plus a percentage of the total costs. This type of contract is called time and materials (T&M). Time is usually contracted on an hourly rate basis and the contractor usually submits time sheets and receipts for items purchased on the project. The project reimburses the contractor for the time spent based on an agreed-on rate and the actual cost of the materials. The fee is typically a percentage of the total cost.

Time and materials contracts are used on projects for work that is smaller in scope and has uncertainty or risk and the project, rather than the contractor, assumes the risk. Since the contractor will most likely include contingency in the price of other types of contracts to cover the high risk, T&M contracts provide lower total cost to the project.

Cost-Reimbursable Contracts

In a cost-reimbursable contract, the organization agrees to pay the contractor for the cost of performing the service or providing the goods. Cost-reimbursable contracts are also known as cost-plus contracts. Cost-reimbursable contracts are most often used when the scope of work or the costs for performing the work are not well known. The project uses a -reimbursable contract to pay the contractor for allowable expenses related to performing the work. Since the cost of the project is reimbursable, the contractor has much less risk associated with cost increases. When the costs of the work are not well known, a cost-reimbursable contract reduces the amount of money the bidders place in the bid to account for the risk associated with potential increases in costs.

If the service provider is responsible for incorporating all costs, including profit, into the agreed-on price, it is a fixed-total-cost contract. The contractor assumes the risks for unexpected increases in labor and materials that are needed to provide the service or materials and in the materials and timeliness needed.

The fixed-price contract with price adjustment is used for unusually long projects that span years. The most common use of this type of contract is the inflation-adjusted price. In some countries, the value of its local currency can vary greatly in a few months, which affects the cost of local materials and labor. In periods of high inflation, the client assumes risk of higher costs due to inflation, and the contract price is adjusted based on an inflation index. The volatility of certain commodities can also be accounted for in a price adjustment contract. For example, if the price of oil significantly affects the costs of the project, the client can accept the oil price volatility risk and include a provision in the contract that would allow the contract price adjustment based on a change in the price of oil.

The fixed-price with incentive fee is a contract type that provides an incentive for performing on the project above the established baseline in the contract. The contract might include an incentive for completing the work on an important milestone for the project. Often contracts have a penalty clause if the work is not performed according to the contract. For example, if the new software is not completed in time to support the implementation of the training, the contract might penalize the software company a daily amount of money for every day the software is late. This type of penalty is often used when the software is critical to the project and the delay will cost the project significant money.

If the service or materials can be measured in standard units, but the amount needed is not known accurately, the price per unit can be fixed—a fixed unit price contract. The project team assumes the responsibility of estimating the number of units used. If the estimate is not accurate, the contract does not need to be changed, but the project will exceed the budgeted cost.

cost reimbursible contracts and turnkey contracts...as the service provider is reponsilble for providing the ready to use system

As a Project Owner I woul prefere "Turn Key" Contract because I have one Contract Partner under Responsibility, who like to have his resources soonest back and free for other Projects.