Federal contractors face increasing scrutiny, stricter compliance regulations, and ongoing geopolitical tensions, each rapidly changing the risk profile of today’s projects. Whether you are managing a domestic infrastructure project or providing staff for a base overseas, your liability risks are growing, along with expectations.
A recent National Law Review article notes that government contractors face evolving legal demands, from cybersecurity certifications to Defense Base Act mandates. The pressure is real, and the consequences are high. Staying ahead requires working with an insurance Advocacy Team that understands this sector and has the expertise to deliver integrated insurance for government contractors for your unique needs.
What You Will Learn
- The Rise of CMMC and Cyber Liability Exposures
- Addressing Structural Safety After GAO Oversight Findings
- Meeting Defense Base Act Insurance Obligations
- Managing International and Political Risk
- The Sahouri Advantage: Proactive, Independent Advocacy
The Rise of CMMC and Cyber Liability Exposures
Cybersecurity Maturity Model Certification (CMMC) requirements are now essential for contractors handling controlled unclassified information (CUI). As the Department of Defense enforces new levels of certification and mandatory assessments, contractors must demonstrate security maturity. Insurance plays a vital role in mitigating residual risk and aiding in breach recovery.
Here's why it matters:
- A single data breach can result in loss of contracts, federal penalties, and long-term reputational damage.
- Many contractors underestimate their cyber risk exposure, especially when working with third-party vendors.
- A technology-driven insurance solution can address these blind spots with tailored cyber liability coverage.
Contractors need more than generic cyber insurance. They need a policy that reflects the sensitivity of their work and integrates with their internal security measures.
Addressing Structural Safety After GAO Oversight Findings
The 2024 GAO Annual Report (GAO-24-106915) highlights inefficiencies in federal programs, including deferred maintenance and repair for federal buildings and structures. The report suggests that agencies could save hundreds of millions of dollars by using predictive models. These models aim to enhance investment decisions by illustrating the importance of proactive risk management in construction oversight.
How Insurance Products and Advocacy Support Contractors
Your policy works as a safeguard and a defense, helping you stay compliant and covered. More than that, it should be a proactive tool that enables you to anticipate and mitigate potential risks, giving you a sense of preparedness and control.
- Coverage for liability stemming from inspection failures or construction defects (note: design flaws may require a separate professional liability policy)
- Risk advisory support from an advocate who understands federal safety expectations
- Tools to document and demonstrate compliance in the face of audits or claims
Explore how contractors leverage insurance for big wins and why one size doesn’t fit all regarding federal compliance.
Meeting Defense Base Act Insurance Obligations
Contractors working overseas are legally required to carry Defense Base Act (DBA) insurance. This category includes subcontractors on projects funded by U.S. government agencies.
DBA insurance typically covers:
- Medical treatment and disability for employees injured abroad
- Emergency evacuation or repatriation costs
- War hazards in unstable regions
While DBA insurance is required for many overseas operations, war-related claims may fall under the War Hazards Compensation Act (WHCA), which requires specific documentation and government approval for reimbursement. An experienced insurance advocate can help ensure all required filings are handled properly.
Managing International and Political Risk
Global instability, from civil unrest to government collapse, is a growing concern. The right insurance can help protect your contract's bottom line, especially in high-stakes regions.
Risks that demand attention include:
- Acts of terrorism or sabotage (note: coverage for terrorism may require a TRIA election or a standalone terrorism endorsement)
- Currency inconvertibility and expropriation (typically covered under specialized political risk insurance)
- Supply chain interruption due to local unrest
Contractors need a modern, bundled risk-management program to safeguard personnel, protect assets, and ensure project continuity, providing a sense of security in the face of potential risks. Working in volatile regions requires working with an insurance advocate familiar with global placement strategies and local regulatory conditions.
The Sahouri Advantage: Proactive, Independent Advocacy
At Sahouri, we deliver more than policies. We provide a consulting-driven experience that simplifies risk management for government contractors. Our team of Advocates specializes in handling complex federal requirements, ensuring that your insurance needs are in expert hands.
Our clients benefit from:
- Independent Advocates who specialize in complex federal requirements
- Customized strategies that evolve with your business and the law
- Technology-driven integration of risk, health, and benefits policies
With tailored coverage, your strategic insurance planning goes beyond protection by supporting compliance, boosting performance, and facilitating long-term success. Contact a Sahouri Advocate to request a comprehensive risk assessment and customized insurance solutions.
