Delay in Start-up (DSU)

Delay in Start Up [DSU] is also referred to as Advanced Loss of Profits [ALOP].

DSU insures project owners for the financial consequences (as described in the policy) of a delay to project completion arising from an insured physical damage event. The cover is best purchased with the Contractors All Risks/Erection All Risks (CAR/EAR) policy covering physical loss or damage to the project.

There are generally three levels of cover:

• Gross profit. Loss of anticipated revenue, including debt service costs, fixed operating costs as well as anticipated net profit, less variable costs.

• Debt service and fixed costs.

• Debt service only.

Increased cost of working is also insured under DSU to the extent that the increased expenditure reduces the insured loss. Any indemnity will be limited to the Insured’s actual loss sustained within the policy parameters.

DSU typically does not cover:

• Fines and penalties.

• Non damage delays (non-performance, late delivery of materials etc.).

• Delays due to redesigning, adding or improving the insured property.

• Inadequate funding to complete the project.