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Defense Base Act and Risk Management Coverage 101

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When most people think of working overseas, they imagine all the wonderful things they will see and do in their new location. What many people don’t consider are the risks associated with being a civilian contractor working for the U.S. government on foreign soil. If you are injured or killed while working overseas, your family may be eligible to receive benefits through the Defense Base Act (DBA). Let’s take a look at what the DBA is, how an accurate assessment of risk management can help you get a quote for DBA insurance, and why it’s important to go with an experienced DBA carrier for Defense Base Act and risk management coverage.

What Is the Defense Base Act and What Purpose Does It Serve?

Brought to life on August 16, 1941, the Defense Base Act (DBA) was originally designed to protect U.S. government contractors working abroad. Created as a response to the increasing number of U.S. citizens working as defense contractors on foreign soil or waters, DBA insurance is essentially an extended form of workers’ compensation that protects contractors and their employees around the clock when they work overseas. Without this insurance, the company owner or contractor would be held liable for any accidents, injuries, or deaths, and could be held financially responsible in the event of a tragedy or mishap.

What Is Insurance Risk Management?

As with any business endeavor, there is likely to be an element of risk—whether that be a financial risk, personnel safety risk, computer hackers, risky transport of goods, etc. However, risks become even more heightened and challenging when U.S. workers contract with the federal government to work abroad. Suddenly, questions of communication, transportation, lodgings, and other logistics become part of the risk equation—as does the stability of the country where the work is to take place.

While of course no one likes thinking of the worst-case scenario as a possibility, the truth is you never know what will happen when you go to work, either domestically, or abroad—but it is equally true that caring for U.S. workers when they are exposed to risk on foreign soil or in foreign waters adds another element of complication and nuance.

Risk management is all about thinking through the process of the scope of work, the state of the geographic region or political climate of the country where the work will take place, the type of work, the qualifications of the employees, the professionalism and competence of the contractor, and more. It is in this process that risks are assessed and quantified, allowing insurance underwriters to come up with an appropriate cost for coverage for any likely risks.

What Does Risk Management Have to Do with DBA Insurance?

If you’re a contractor—even a domestic contractor—you likely understand that cannot be business proceedings without facing some sort of risk associated with your mission. Typically, for American workers on American soil, these risks are covered by workers’ compensation insurance, which protects them when they are “on the clock” from injury, disability or ongoing work-related injury, lost wages, or even accidental work-related death.

DBA insurance simply takes this policy coverage to the next level. Because of the risks associated with working abroad, with no chance to “unplug” from the project and seek lower-risk activities, typically DBA insurance covers U.S. government contractors working abroad and their employees around the clock, not just during hours of normal operation. Factoring in the appropriate amount of risk management is crucial to coming up with a fair price for coverage while also protecting business owners from likely—or even relatively unlikely—incidents or tragedies. Risk must be calculated by looking at the latest information on country stability, the type of work to be performed, payroll and number of employees, and more.

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Defense Base Act and Risk Management Professionals at Risk Reconnaissance

Clearly, coming up with an extensive list of possible risks associated with your overseas assignment is a crucial part of coming up with a comprehensive DBA insurance coverage plan. As much as a U.S. government contractor wants to make sure their bases are covered and their employees (and their families) will be well taken care of in the event of an emergency, it may come as no surprise that, depending on the assignment, DBA coverage can come at a significant cost. This is why you’ll want to work with a qualified DBA insurance carrier like Risk Reconnaissance to deliver the optimal coverage for your mission at the best possible rates. Here are the top three reasons you should trust Risk Reconnaissance to be your risk assessor, underwriter, and insurance provider!


Creator of Risk Reconnaissance and military veteran Brian S. Smith, CIC, ARM has been working in the insurance industry for several decades and is also the Vice President and Partner of the Insurance Office of America. Brian recognized a hole in the insurance industry in 2006 during Operation Enduring Freedom, as very few underwriters knew how to accurately assess risk for government contractors working in Iraq and Afghanistan. A military veteran himself, Brian knew he had the insider knowledge to create the underwriting and coverage U.S. government contractors needed to bring their crew home safely and execute their mission successfully.


The staff at Risk Reconnaissance has experience working with more federal entities than just the military, however. With experience working with an array of federal government entities, including the Department of Labor (DOL), our staff knows how to get contractors the results they need within the parameters of their timeline, and can help less experienced contractors leverage the most out of their position.

On Your Side

At Risk Reconnaissance, we honor those that serve our country, both domestically and abroad—and we believe that quality coverage should not be cost-prohibitive. We understand DBA insurance coverage is often a legal requirement, but our agents will help you accurately assess risk, find the lowest premiums, and offer the best chance at reimbursement at the end of your contract thanks to the “allowable cost” status of DBA insurance coverage. This means that, depending on your level of coverage and which government entity they will be working with, contractors will likely be entitled to at least partial reimbursement of the cost of insuring their employees. At Risk Reconnaissance, we want to make sure you are informed of your rights and opportunities for reimbursement.

Want to learn more about what Risk Reconnaissance can do for your mission? Contact us today for a consultation and experience for yourself what makes us the best!