BBG is the leader in the Washington DC metro area in DBA (Defense Base Act) Insurance Coverage. We can help you understand DBA Insurance and the requirements from the US Department of Labor for employees of US Government Contractors working overseas. We specialize in working with Government Contractors working overseas for Department of Defense (DOD) contracts only. The BBG advantage includes:
- Fast turnaround – most quotes can be generated within 24 hours after submitting an application or speaking with one of our local DBA Insurance professionals.
- We represent all major carriers currently writing DBA insurance – three of which account for approximately 97% of the DBA premium which allows for open market shopping to provide you with the most competitive rates.
- Provide a single source solution for all international insurances.
What is DBA Insurance?
The Defense Base Act (DBA) provides workers compensation type insurance coverage for contractor employees performing under government contracts outside the United States. It is intended to be a counterpart to domestic workers compensation coverage and, as such, is the sole recourse for workers who suffer on-the-job injuries or death while engaged in work in foreign locations under government prime contracts and subcontracts. Under a companion law, the War Hazard Compensation Act (WHCA), the government essentially self-insures for those instances in which an injury to or death of a DBA-covered worker arises from a war risk hazard. Both the DBA and WHCA programs are overseen and administered by the Department of Labor (DOL).
DBA Insurance covers almost 200,000 prime and subcontractor employees and generating annual government-wide premiums of more than $400 million. Although DOL approved a significant number of insurers to offer DBA coverage, the current market is dominated by three major carriers, with one of them having about three-quarters of the total market.
The Cost & Benefits of DBA Insurance:
The cost for DBA insurance—if allocable and reasonable—is a reimbursable cost under government contracts.
Death benefits are half of the employee’s average weekly earnings to the surviving spouse or to one child, and two-thirds of earnings for two or more such survivors, up to the current maximum weekly rate. Permanent total disability and death benefits may be payable for life, and are subject to annual cost of living adjustments. There is no minimum compensation rate under the Defense Base Act.
There are five provisions in the current version of the DBA that prompt coverage:
- Any employee working on a military base or reservation outside the U.S.
- Any employee engaged in U.S. government funded public works business outside the U.S.
- Any employee engaged in public works or military contract with a foreign government which has been deemed necessary to the U.S. National Security.
- Those employees that provide services funded by the U.S. government outside the realm of regular military issue or channels.
- Any employees of any sub-contractors of the prime of letting contractor involved in a contract like numbers 1 – 4 above.
Waivers:
U.S. nationals, local country nationals or third country nationals are covered under the DBA. Waivers can be granted, but they need to follow certain criteria and only the U.S. Secretary of Labor is able to authorize a waiver.
Key points about obtaining waivers include:
- Class of the employee must have available alternate means of compensation such as employers’ liability, workers’ compensation or Social Security.
- Waivers cannot be requested for U.S. citizens or those employees hired inside the U.S.
- The U.S. Government agency letting the contract must recommend that such a waiver be granted.
- The U.S. Government agency or department head letting the contract must file an application with the U.S. Department of Labor.
- No waivers have been granted for Iraq or Afghanistan.
Coverage Issues
Two doctrines, known as the Zone of Special Danger and Reasonable Recreation, are central to the expansive nature of coverage under DBA. The Zone of Special Danger doctrine dictates that where there exists unique conditions or circumstances of employment which place an employee in a zone of danger, then an accident resulting in injury or death need not be strictly related to job duties in order to trigger DBA benefits.
The Reasonable Recreation doctrine dictates that an employee’s injury or death in the course of the employer’s furnished, funded or promoted recreational activities triggers DBA benefits. Some non-sponsored activities may also trigger coverage. Please note that these two doctrines taken together greatly expand the scope of coverage beyond that of traditional domestic U.S. workers’ compensation. Government contractors are generally required by law to obtain DBA coverage for their employees. Failure to obtain DBA coverage may carry stiff penalties such as fines or imprisonment, civil liability for damages in connection with the injury or death and/or the loss of the government contract.
Failure to obtain DBA insurance:
Failure to obtain DBA carries stiff penalties. All government contracts contain a provision that requires bidding contractors obtain necessary insurance. Failure to do so will result in fines and possible loss of contract. The additional and the most severe penalty is that the employers without DBA coverage are subject to suits under common law wherein common law defenses are waived. In others words, the claimants or their heirs need only file suit and do not have to prove negligence. Lastly, all claims may be brought in Federal Court and are against the insured directly.
Obtain A Quote
Contact our local team of professionals located in the DC Metro Area Specializing in DBA (Defense BaseAct) Coverage for over 16 years.
Email: dba@bbgbroker.com
Phone: 844-437-7288 x 282 or Toll Free: 800-719-5593
Click here to print an application for DBA coverage.