SEC. 843. REQUIREMENT FOR DEPARTMENT OF
DEFENSE TO ADOPT AN ACQUISITION STRATEGY FOR DEFENSE BASE ACT
INSURANCE.
(a) In General- The Secretary of
Defense shall adopt an acquisition strategy for insurance
required by the Defense Base Act (42 U.S.C. 1651 et seq.) which
minimizes the cost of such insurance to the Department of
Defense and to defense contractors subject to such Act.
(b) Criteria- The Secretary shall ensure that the acquisition
strategy adopted pursuant to subsection (a) addresses the
following criteria:
(1)
Minimize overhead costs associated with obtaining such
insurance, such as direct or indirect costs for contract
management and contract administration.
(2) Minimize costs for coverage of such insurance consistent
with realistic assumptions regarding the likelihood of
incurred claims by contractors of the Department.
(3) Provide for a correlation of premiums paid in relation to
claims incurred that is modeled on best practices in
government and industry for similar kinds of insurance.
(4) Provide for a low level of risk to the Department.
(5) Provide for a competitive marketplace for insurance
required by the Defense Base Act to the maximum extent
practicable.
(c)
Options- In adopting the acquisition strategy pursuant to
subsection (a), the Secretary shall consider such options
(including entering into a single Defense Base Act insurance
contract) as the Secretary deems to best satisfy the criteria
identified under subsection (b).
(d) Report-
(1)
Not later than 270 days after the date of enactment of this
Act, the Secretary shall submit to the Committees on Armed
Services of the Senate and the House of Representatives, the
Committee on Homeland Security and Governmental Affairs of the
Senate, and the Committee on Oversight and Government Reform
of the House of Representatives a report on the acquisition
strategy adopted pursuant to subsection (a).
(2) The report shall include a discussion of each of the
options considered pursuant to subsection (c) and the extent
to which each option addresses the criteria identified under
subsection (b), and shall include a plan to implement within
18 months after the date of enactment of this Act the
acquisition strategy adopted by the Secretary.
(e)
Review of Acquisition Strategy- As considered appropriate by the
Secretary, but not less often than once every 3 years, the
Secretary shall review and, as necessary, update the acquisition
strategy adopted pursuant to subsection (a) to ensure that it
best addresses the criteria identified under subsection (b).
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