35.013
Insurance
When nonprofit, educational, or State institutions cannot carry insurance for cost-reimbursement contracts, contracting officers must reference FAR 28.311 for proper clause coverage.
Overview
FAR 35.013 addresses the unique insurance considerations for nonprofit, educational, or State institutions performing cost-reimbursement contracts. These entities may not carry insurance due to immunity from tort liability or legal prohibitions against purchasing insurance. In such cases, contracting officers are directed to FAR 28.311 for guidance on appropriate contract clause coverage to address these circumstances. This ensures that contracts with these institutions remain compliant with federal requirements, even when standard insurance provisions cannot be applied.
Key Rules
- Insurance Requirements for Certain Institutions
- Nonprofit, educational, or State institutions may not carry insurance for cost-reimbursement contracts due to immunity or legal restrictions.
- Reference to FAR 28.311
- When insurance is not carried, contracting officers must consult FAR 28.311 to determine the correct contract clauses to include.
Responsibilities
- Contracting Officers: Must verify the insurance status of these institutions and ensure the correct clauses are included per FAR 28.311.
- Contractors (Institutions): Must inform the contracting officer if they do not carry insurance due to immunity or legal prohibition.
- Agencies: Should ensure oversight and compliance with FAR insurance requirements for these contracts.
Practical Implications
- This section exists to address the legal and practical realities faced by certain institutions regarding insurance.
- It impacts contract formation by requiring alternative clause coverage when standard insurance is not possible.
- Common pitfalls include failing to verify insurance status or omitting required clauses, which can lead to compliance issues.