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Sandi78

52.228-5 Insurance - Work on a Government Installation

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Who can explain what this means in 'laymens' terms?

This is a statement taken from paragraph b of clause 52.228-5.

"The policies evidencing required insurance shall contain an endorsement to the effect that any cancellation or any material change adversely affecting the Government's interest shall not be effective (1) for such period as the laws of the State in which this contract is to be performed prescribe or (2) until 30 days after the insurer of the Contractor gives written notice to the Contracting Officer whichever period is longer"

In my job, I have to convince insurance agents to put this as an endorsement on tier subcontractor's insurance certificates. Many insurance companies won't do it. Most agents want to use the standard cancellation clause that's in the policy; however, that doesn't address the material changes that could adversely affect the Government's interest. What is an example of something in an insurance policy that could be adverse to the Government?

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What is an example of something in an insurance policy that could be adverse to the Government?

A couple of thoughts come to mind: Lowering the coverage amount below the contract's minimum requirements, naming additional named insured's or cancelation of the policy without (or minimal notice). In CA, the state only requires 10 days cancelation notice; the FAR requires 30. My advice to our contractors is: if you cannot convince your insurance company to change their policy's terms, find another insurance company.

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