Delay in Start-Up Insurance UK (DSU Insurance Explained)
What is Delay in Start-Up Insurance?
Delay in Start-Up Insurance (DSU), also known as Advanced Loss of Profits (ALOP), protects against financial losses caused by delays to construction projects following insured damage.
While Contractors All Risks (CAR) insurance covers physical damage to the works, DSU insurance covers the financial impact of that delay, such as lost income or additional costs.
👉 In simple terms:
CAR = fixes the damage
DSU = covers the financial consequences of delays
What Does DSU Insurance Cover?
A DSU policy can cover a range of financial losses for contractors, including:
✔ Loss of Revenue
Income that would have been generated if the project had completed on time.
✔ Loss of Rental Income
For property developments, this includes delayed tenant income.
✔ Additional Financing Costs
Interest payments and funding costs incurred due to delays.
✔ Increased Operating Costs
Additional expenses required to mitigate or reduce delays.
What Triggers a DSU Claim?
DSU insurance only responds when there is:
👉 Physical damage covered under a Contractors All Risks (CAR) policy
This means:
Fire
Flood
Storm damage
Collapse or structural damage
👉 If the delay is not caused by insured damage, DSU will not apply.
See some real construction insurance claims
What is NOT Covered by DSU Insurance?
Typical exclusions include:
Delays caused by poor planning or project mismanagement
Contractor insolvency (unless linked to insured damage)
Supply chain issues without physical damage
Market conditions or reduced demand
👉 This is why DSU must be carefully structured alongside other policies.
Who Needs Delay in Start-Up Insurance?
DSU insurance is particularly important for:
Property developers
Commercial landlords
Investors and funders
Infrastructure projects
Renewable energy developments
👉 If your project relies on future income or revenue, DSU is critical.
Real Claim Example: DSU Insurance in Action
A developer was constructing a £12 million residential scheme intended for rental income.
During the build:
A major fire damaged part of the structure
Repairs took over 5 months
The project completion was significantly delayed
As a result:
Rental income was delayed
Financing costs increased
Investor returns were impacted
Total financial losses exceeded £1.8 million.
Because DSU insurance was in place alongside a CAR policy:
The delay was linked to insured physical damage
The insurer covered a significant portion of lost rental income
Financing losses were partially recovered
👉 Without DSU cover, these losses would not have been insured.
How DSU Insurance Fits Into a Construction Insurance Programme
DSU insurance should always sit alongside:
Professional indemnity insurance
Public and employers’ liability
👉 For a full overview, see our guide for complex construction risks in the UK
How Much Does DSU Insurance Cost?
DSU premiums depend on:
Project value
Expected revenue or rental income
Construction duration
Risk profile of the build
Typically, DSU is priced as a percentage of the project value or anticipated income.
👉 The key is ensuring the indemnity period is long enough to cover realistic delays.
Common Mistakes with DSU Insurance
Many projects are underinsured due to:
Indemnity periods that are too short
Incorrect revenue calculations
Failure to align DSU with CAR cover
Not accounting for realistic rebuild timelines
👉 These issues often only become apparent at claim stage.
Why Work With a Specialist Construction Insurance Broker?
DSU insurance is highly technical and must be carefully structured.
A specialist broker will:
Align DSU with CAR and other policies
Ensure accurate financial calculations
Negotiate terms with specialist insurers
Support you through complex claims
👉 This ensures your financial exposure is properly protected.
Get Expert Advice on DSU Insurance
Many construction projects we review have gaps in delay cover or insufficient indemnity periods, leaving developers exposed to major financial losses.
If you’re planning a project — or reviewing your insurance programme — we can help.
📞 01792 001350
📧 [email protected]
👉 Speak to a specialist and make sure your project is fully protected.
Check out the most Frequently Asked Questions on DSU Insurance
