Hostile Regions that Affect DBA—
When contractors bid for U.S. Government contracts in overseas locations, the localities to where employees are deployed can be rather volatile. These adverse environments can put employees at greater risks for their safety. U.S. Contractors should be aware of the potential implications when contracting for work to hostile countries. The risks for injury and death are much greater, as security is compromised. As a result, the likelihood of claims increases, which in turn, can affect a contractor’s DBA losses.
This infographic depicts some of the countries currently experiencing hostile situations due to government conflict and war.
The insurance benefits afforded under a Defense Base Act Insurance policy provide comprehensive protection for workers who are employed to perform work overseas under a U.S. Government contract. In order for a claim to be compensable under DBA, it must be occupational in nature, meaning that an injury sustained or resulting in death must be directly related to an employee’s job duties.
While DBA benefits are equivalent to those afforded by domestic Workers’ Compensation, there are some excluded ailments, or conditions, that contractors and employees should be mindful of.
Heart attack and stroke are two afflictions that are typically not compensable DBA claims. However, these conditions may be considered if it is determined that the heart attack or stroke is stress-related due to the strenuous nature of the employee’s occupation.
Appendicitis is another ailment that is typically not covered by DBA. However, if the condition occurs while an employee is confined to a remote location such as a military base where medical services are limited, coverage for the claim could be allowable under the Zone of Special Danger doctrine, which broadens DBA benefits.
Suicide is never covered under DBA. In order to facilitate necessary counseling services to those employees who may be in need of assistance, employers should provide their on-location management team with the training they need to help identify employees who may be experiencing depression or other personal difficulties.
These exclusions are just a few examples of some ailments that are not generally covered under a DBA Insurance policy—but it is not a comprehensive list. As such, employers should submit every claim to their DBA Insurance company, regardless of the situation. The insurance carrier will review the claim and determine whether or not it will be eligible for compensation under the policy (the employer should never attempt to make this determination on their own!). By reporting every claim at the time it is presented, the employer avoids the risk of incurring a fine for late reporting and also the potential for wrongfully denying benefits owed to an employee in the event the claim is deemed to be compensable.
As the DBA Insurance broker for Allied World Assurance, the LATITUDE DBA Insurance team has a deep understanding of the complexities of Defense Base Act coverage. Contractors seeking DBA coverage should contact LATITUDE DBA Insurance today―we’d be happy to assist in creating an insurance plan that protects both the business and its employees against all overseas exposures.
When deployed overseas to war-torn or unstable locales around the world, living conditions for employees can be quite dangerous. They must be precautious, whether on or off base, working or not. Because of the volatile and remote locations in which many overseas U.S. Government contractors work, the Department of Labor chose to include two addendums to the Defense Base Act in order to broaden eligibility under DBA Insurance benefits.
Zone of Special Danger
The Zone of Special Danger doctrine broadens DBA Insurance benefit eligibility by making more types of claims compensable when an employee is confined to a “zone of special danger” (i.e. on military bases in Iraq or Afghanistan). Because of the doctrine, injuries stemming from activities normally not considered as part of the workday are given consideration under DBA because of the contained living environment.
While the scope of benefits may be expanded by the Zone of Special Danger doctrine, it does not mean that employees are covered 24-hours a day, regardless of the activities they engage in. Claims arising from activity that is completely disconnected from an employee’s employment are not compensable, in most cases.
The Reasonable Recreation doctrine allows consideration of compensation for claims arising from recreational activities for employees stationed in very remote or confined locations. Coverage is based on the premise that employees who are confined to such areas (i.e. Naval Bases on Marshall Islands or Guantanamo Bay) will engage in the limited recreational activities available to them. Injuries that are sustained as a result of these recreational activities may be considered for compensation.
The following claim examples illustrate how these doctrines affect eligibility for DBA benefits:
Example of compensable claim: An employee stationed at Guantanamo Bay was bitten by shark in the waters while swimming as a recreational activity. DBA benefits were payable under the Reasonable Recreation doctrine.
Example of claim NOT covered: A claim was filed by an employee stating he suffered psychological harm from the use of chemical peels during his employment in Kuwait. The employee was awarded benefits under the Zone of Special Danger doctrine. However, the DBA Insurance carrier later appealed the decision through the Benefits Review Board, resulting in an overturning of the benefits award on the grounds that the chemical peel treatment was personal in nature and not related to the employee’s employment.
As the DBA Insurance broker for Allied World Assurance, the LATITUDE DBA Insurance team has a deep understanding of the nuances of Defense Base Act coverage. We’re here to assist contractors in creating an insurance plan that protects both their business and its employees against all overseas exposures. Contact LATITUDE DBA Insurance today!