Defense Base Act (DBA) Insurance
International Workers' Compensation Coverage
What is DBA Insurance?
DBA insurance, or Defense Base Act insurance, is a law that requires insurance coverage for employees working on a US Government contract outside of the United States. Benefits workers can get from DBA include disability compensation, coverage for medical expenses and death benefits.
Who is Covered Under DBA Insurance?
The Defense Base Act insurance applies to any employee, regardless of nationality, who:
- Is a subcontractor (Prime Contractor is responsible for ensuring that the subcontractor has required DBA insurance)
- Works on public work contracts with any US government agency, including construction and service contracts in connection with national defense or with war outside the US
- Works for the private sector on US military bases or overseas on lands or in territories used by the US for military purposes
- Works on overseas contracts approved and funded by the US under the USAID Foreign Assistance Act
- Works for American employers providing welfare or similar services outside of the United States for the Armed Forces
Get the Best Price for Your DBA Insurance
Clements works as an independent international broker and has access to all leading workers' compensation insurers to find the best policy for your organization.
Get quotes from all the top DBA insurance providers
Defense Base Act Insurance Benefits
We will help you& find, comprehensive DBA insurance coverage and support at the time of claims that includes:
- Statutory workers’ comp benefits paid to employees, their dependents or medical providers in case of job-related fatalities or injuries
- Benefits are paid regardless of employer’s responsibility for the injury
- Employer’s liability coverage for suits arising from work-related injury or illness, including negligence claims
Types of DBA Coverage Provided
Defense Base Act insurance covers the following if workers on a government contract are killed or injured during their employment:
- Medical: Any government contractor who gets injured on the job is entitled to medical treatment by a physician of their choice or as the injury requires.
- Burial Benefits
- Indemnity for Loss of Wages and Income: Whether you were severely injured or killed while on the job, you can recover a portion of your wages.
- Disability Benefits: Compensation for total disability is 2/3rds of the employee’s average weekly earnings. In some cases, disability compensation can be paid out for life. Employees can get up to 2/3rds of their weekly earnings, up to a current maximum of $1,726.98 per week. Compensation is also available for partial loss of earnings.
- Death Benefits: Allows surviving spouses and/or children to collect partial earnings from the deceased employee. In some cases, beneficiaries can receive payments for life under DBA permanent total disability and death benefits coverage. These payments can also be subject to annual cost of living adjustments. Half of an employee’s weekly earnings are payable to the surviving spouse or to one child. Some may be eligible for 2/3rds of a deceased spouse’s earnings if there are two or more surviving family members.
- No Benefit: If a contractor is killed on the job and they don’t have qualifying dependents like a spouse or children, they do not qualify for death benefits.
Additional Recommended DBA Coverage
Having comprehensive coverage offsite is crucial. DBA insurance only covers you on the job, but these policies can provide additional protection while you serve out your government contract:
- General Liability: Covers employees liable for bodily injury or property damage. It also reimburses medical expenses for injured parties. It also covers lawsuits alleging property damage or injury due to a contractor’s services.
- Travel Accident Coverage: Provides 24/7 coverage for your employees outside of their home country, even if they go on vacation. Coverage can include everything from disability insurance to emergency medical evacuations.
- Kidnap/Ransom: Covers employees in the event they are kidnapped. It can also cover the cost of crisis negotiations, extortion, ransom and illegal detention.
- Life: Pays out an employee’s spouse or other designated beneficiary if they die. Qualifying events can vary between contracts. Speak with a Clements advisor to get more details.
- Health: Covers in-patient, out-patient and emergency expenses for incidents that occur off the job.
Examples of Employees Covered Under DBA
All employees working on a government contract, regardless of their profession, are required to have DBA insurance. A few examples of those include:
- Engineers
- Consultants
- Project Managers
- Facilities Maintenance Services
- Educational Institutions
- IT Providers/Professionals
- Logistics Professionals/Support Services
- Media Personnel
- Healthcare/Medical Professionals
- Security Guards
DBA Quote Checklist
Before you start looking for a DBA quote, you’ll want to do the following:
- Choose a qualified broker that has access to major carriers
- Review the DBA application with your broker and provide supporting documents such as:
- Scope of work proposals
- Contract number/solicitation number
- Estimated payrolls
- Give brokers these documents so they can present them to the insurance market
- Have broker present quote options to you
- Work with your broker to finalize the terms and choose your initial coverage carrier
Get started! Fill out a quote application today
Defense Base Act Insurance FAQs
What Does a Defense Base Act Insurance Policy Cover?
In general, Defense Base Act insurance coverage provides disability, medical, and death benefits to covered employees injured or killed in the course of employment.
What is the Difference Between DBA and Workers’ Comp Insurance?
Workers’ Compensation provides coverage for employees who get injured on the job. DBA acts as an extension of workers’ compensation insurance covering civilian employees working on US Government contracts overseas. DBA has special rules that govern its coverage policies. For instance, government contractors can only purchase DBA coverage from an insurer approved by the US Department of Labor.
While workers’ compensation laws can vary from country to country, DBA applies to US Federal Law, as all independent government contractors and government contracting agencies must obtain DBA coverage, including for locals and foreign nationals.
Read more about questions we frequently get from our prospects:
You need Defense Base Act insurance for any public works contract you carry out overseas, unless you are operating in a waiver country and have obtained the local workers compensation scheme for your local national employees, or you have a waiver from the Secretary of the Department of Labor.
Employers who don’t obtain DBA insurance could face steep penalties, including misdemeanor convictions, fines and possible jail time. For corporations, officers can be held responsible for not obtaining DBA benefits as stated under the law.
Notify your insurance carrier (or your claims administrator, if you’re self-insured) as soon as you become aware of an injury or death. Medical treatment should be authorized immediately if it is needed.
An Employer's First Report of Injury, Form LS-202, must be filed with the OWCP within 10 days of the injury, if it causes loss of one or more work shifts. The Form LS- 202 may be filed electronically. Notice should be sent to DLHWC's Central Case Create site below. This site creates cases for all new injuries, regardless of the location of injury or claimant’s home address. After the case is created, it is viewable electronically by the District Office with jurisdiction for the case.
U. S. Department of Labor
Office of Workers' Compensation Programs
Division of Longshore and Harbor Workers' Compensation
201 Varick Street, Room 740
Post Office Box 249
New York, NY 10014-0249
The cost of your workers' comp insurance depends on several factors, including but not limited to:
- the location of your contract
- the scope of the work involved
- the size of your payroll
- your DBA insurance loss history
- the US government agency associated with your contract
Once the underwriter determines an effective DBA insurance rate, that rate equals the total cost of the payroll. To calculate your totals, use the equation below:
DBA Rate x Total Payroll = Annual DBA Cost
If you have a minimum cost or minimum premium due to small payroll exposure, this may not apply.
DBA insurance lets government contract workers collect up to two-thirds of their weekly pay if they get injured on the job. While DBA doesn’t have a minimum compensation rate, the current maximum payout employees can receive is $1,030.78 per week. Weekly payouts are also available for partial loss of earnings. Additionally, DBA entitles injured employees to choose their own doctor when seeking medical treatment.
Yes, DBA insurance is an allowable cost, but your reimbursement level may vary. Some contracts only allow for the most inexpensive plan technically acceptable, which generally only allow partial reimbursement. Other contracts list DBA coverage as a fully reimbursable expense. Clements has direct access to multiple carriers, so you can be certain you’re getting the lowest pricing.
Yes, foreign nationals are required to have Defense Base Act insurance. The exception would be if you are operating in a waiver country, and you have the local state scheme workers compensation. Individuals of any nationality may claim DBA benefits.
DBA coverage can also extends to government contractors stationed in hazardous areas internationally under the Special Dangers Doctrine. For instance, your DBA policy would cover your employees if you sent them base in Sierra Leone and they got injured in the building they were staying in due to poor housing conditions.
While government contractors must carry Defense Base Act (DBA) insurance, waivers allow both contracting agencies and independent contractors to purchase alternative workers’ compensation.
Who Can Qualify for a DBA Waiver?
Waivers must be approved by the Secretary of Labor. Waivers do not apply to US citizens, legal residents or any employees hired in the US. Check out the US Department of Labor’s website to learn more.
Those who can get approved for waivers include:
- Local Country Nationals (as long as they’re not US citizens)
- Third-Party Nationals (Non-US expats)
