Subcontractor Default Insurance (SDI)

Why we were hired: Past private client

Services provided: Construction Audit Services, GMP Review, Change Order Review

Owner was in the process of completing three projects over the course of a year and a half. Two of the projects were ground up construction and the other was a remodel of their corporate headquarters. The total of all three projects was $34M.

The Owner selected the same contractor to complete all three projects, and the contractor proposed to use Subcontractor Default Insurance (SDI) on all of the projects. Estimated costs of SDI was $400,000.

Based on a review of the SDI costs and researching their claims history, the owner decided not to proceed with insurance. All three projects were completed with no subcontractor issues. Based on research, CMCC prevented the owner from paying $400K in SDI costs.