Assuring lenders and investors
Remedial Cost Cap insurance provides stop-loss limits for cost overruns for a specific project work scope. This is useful for large-scale environmental remediation or construction projects that can be used to satisfy concerns and covenants from lenders, investors, buyers or sellers.
Cost Cap insurance is an option to escrow, regulatory financial assurance and can potentially shift cost overrun liabilities from balance sheets. A Cost Cap insurance policy is individually “manuscripted” for each project. A specific work scope and cost estimate is required. In the case of regulated environmental cleanups, an approved remedial plan is usually required to secure coverage.
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