Every answer and its explanation appears here once you have finished the path. Each one then links to the matching glossary entry, where the concept is set out in full with its worked example.
1. Why is a delay penalty uninsurable for the party receiving it and for the party owing it alike?
Because it is a contractual sanction, fixed in advance and with no necessary relation to the actual loss
Insurance repairs an established loss, and a penalty is owed whether the loss is larger, smaller or nonexistent: that disconnect is what puts it outside the field, on both sides at once. The party receiving it cannot insure it because it has not necessarily lost that amount; the party owing it cannot insure it because it would be insuring the cost of its own default. The answer invoking contract law names an accurate fact that explains nothing: plenty of contractual obligations are insured.
Glossary entry →2. The contract sets a penalty of 9,000 euros per day. What is that figure worth to the delay cover?
It is a calculation cap and not a sum owed: the cover repairs a margin established on a business plan fixed before the loss
The contract figure is the one the parties negotiated to sanction, not the one operations would have produced, and confusing the two leads to claiming an amount demonstrable nowhere. The cover requires a margin established on the business plan, with all the difficulties peculiar to an asset that never operated. Believing the two mechanisms independent, as another answer suggests, prepares badly for the next question: they are not, and that is exactly where the file turns.
Glossary entry →3. The owner collects penalties and claims a delay indemnity on the same slippage. What do most wordings do?
They deduct the penalties from the indemnity, to prevent one loss being repaired twice
Both flows compensate the same delay, and stacking them would leave the owner better off than if the loss had not happened, which the indemnity principle refuses. It is also what makes the next question decisive, since the deduction does not always bear on what was collected. Believing in addition is the module's costliest error, because it leads to building a cash plan on two receipts of which only one will arrive.
Glossary entry →4. The owner waives penalties to preserve its relationship with the main contractor. What happens if the deduction bears on penalties due rather than collected?
It gives them up for nothing: they are deducted from the indemnity whether collected or not
The nuance turns on one word of the contract and costs exactly the amount given up: waiving penalties that are due makes a gift to the contractor with the insurer's money, since the insurer will deduct them anyway. It is a commercial decision usually taken without reading the clause, and the useful step is checking that word before waiving rather than after. The answer imagining subrogation by the insurer over penalties mixes two mechanisms: it does not claim them, it subtracts them.
Glossary entry →5. An exceptional weather event stops the site for six weeks without damaging anything. Who bears that delay?
Nobody but the owner: the weather event can excuse the penalties without opening the delay cover, for want of physical damage
The delay exists, it costs, and both protections fall away at once for two different reasons: one because an external event relieves contractually, the other because no physical damage triggers the cover. This module and the one on natural events meet exactly here, and it is the configuration to have in mind when negotiating the works contract, the only place this risk is shared. The answers putting the burden on the contractor or the insurer look for a debtor where the contract names none.
Glossary entry →