Sign In
  • Question

    Q1: In contrast to Government Furnished Property clause, 255.228-7001 (c) references "Contractor's share of loss amount under the Government's self-insurance". Is this 'contractor's share of loss amount'/deductible to the government's self-insurance a known amount as it could affect pricing strategy? Q2: Pursuant to 255.228-7001 (c), exceptions may be specifically provided in the Schedule as an exception to this clause. Can you please clarify both (A) if this means the contractor might need to provide insurance for aforementioned aircraft and (B) how often, if at all, such exceptions have been made historically on the contract?


    Answer

    A1:  The Contractor assumes the risk of loss and shall be responsible for the Contractor's share of loss under the Government's self-insurance. That share is the lesser of; the first $100,000 of loss or damage to aircraft in
    the open, during operation, or in flight resulting from each separate event, except for reasonable wear and tear and to the extent the loss or damage is caused by negligence of Government personnel; or twenty percent of the price
    or estimated cost of this contract.  This shared liability is conditional -from indemnification to full liability.  A contractor's liability is situational and requires a thorough knowledge and understanding of DFARS 252.228-7001,  paragraphs d thru f.


    A2: The "exceptions" referred to in DFARS 252.228-7001, paragraph c are those exceptions and modifications allowable by DFARS 228.370(b)(1).  The exceptions define circumstances where risk to government aircraft is small, the risk is to other than DoD assets, or the risk of loss is mitigated by the FAA.


    There is NO allowable exception for flight.  The government's assumption of risk shall not extend to damage, loss, destruction of aircraft sustained during flight if either the flight or the flight crew members have not been
    approved in advance of any flight in writing by the Government Flight Representative, who has been authorized in accordance with the combined regulation/instruction entitled "Contractor's Flight and Ground Operations"
    (DCMAI 8210.1C).

     

    Open full Question Details