Source: Tango Specialty

A real estate developer hires a mechanical engineering firm to design and oversee the installation of an HVAC system for a national box-chain client in a mall project the developer owns. Upon the completion of the project the HVAC system is not performing as intended and needs to be replaced. The cost overruns, construction delays, and the lost business the retailer incurs adds up to over $1.75M in damages. The HVAC engineer only carried $1M in Professional Liability limits resulting in a $750K loss to the developer. Protective indemnity coverage will reimburse the developer for these otherwise uninsurable out of pocket losses.