§7.6 INSURANCE
Insurance requirements in project finance are demanding, and as a result insur-
ance costs are high, but this tends to be a neglected area of project development.
This can lead to an underestimation of project costs because all required insur-
ances have not been taken into account or to the financing being held up because
the insurances required by the lenders are not in place. At an early stage of the
project’s development, therefore, the Sponsors need to appoint an insurance bro-
ker with specific experience both in insurance for project finance in general, and
in insuring major projects in the country concerned, to advise on and eventually
place the insurance program.
The broker also plays an important role in communicating informat