50.104-3 Special procedures for unusually

hazardous or nuclear risks.

(a) Indemnification requests.

(1) Contractor requests for the indemnification clause to cover unusually hazardous or nuclear risks

should be submitted to the contracting officer and shall include the following information:

(i) Identification of the contract for which the indemnification clause is requested.

(ii) Identification and definition of the unusually hazardous or nuclear risks for which

indemnification is requested, with a statement indicating how the contractor would be exposed to

them.

(iii) A statement, executed by a corporate official with binding contractual authority, of all insurance

coverage applicable to the risks to be defined in the contract as unusually hazardous or nuclear,

including-

(A) Names of insurance companies, policy numbers, and expiration dates;

(B) A description of the types of insurance provided (including the extent to which the contractor is

self-insured or intends to self-insure), with emphasis on identifying the risks insured against and the

coverage extended to persons or property, or both;

(C) Dollar limits per occurrence and annually, and any other limitation, for relevant segments of the

total insurance coverage;

(D) Deductibles, if any, applicable to losses under the policies;

(E) Any exclusions from coverage under such policies for unusually hazardous or nuclear risks; and

(F) Applicable workers’ compensation insurance coverage.

(iv) The controlling or limiting factors for determining the amount of financial protection the

contractor is to provide and maintain, with information regarding the availability, cost, and terms of

additional insurance or other forms of financial protection.

(v) Whether the contractor’s insurance program has been approved or accepted by any Government

agency; and whether the contractor has an indemnification agreement covering similar risks under

any other Government program, and, if so, a brief description of any limitations.

(vi) If the contractor is a division or subsidiary of a parent corporation-

(A) A statement of any insurance coverage of the parent corporation that bears on the risks for

which the contractor seeks indemnification; and

(B) A description of the precise legal relationship between parent and subsidiary or division.

(2) If the dollar value of the contractor’s insurance coverage varies by 10 percent or more from that

stated in an indemnification request submitted in accordance with paragraph (a)(1) of this
subsection, or if other significant changes in insurance coverage occur after submission and before

approval, the contractor shall immediately submit to the contracting officer a brief description of the

changes.

(b) Action on indemnification requests.

(1) The contracting officer, with assistance from legal counsel and cognizant program office

personnel, shall review the indemnification request and ascertain whether it contains all required

information. If the contracting officer, after considering the facts and evidence, denies the request,

the contracting officer shall notify the contractor promptly of the denial and of the reasons for it. If

recommending approval, the contracting officer shall forward the request (as modified, if necessary,

by negotiation) through channels to the appropriate official specified in 50.102-1(d). The contracting

officer’s submission shall include all information submitted by the contractor and-

(i) All pertinent information regarding the proposed contract or program, including the period of

performance, locations, and facilities involved;

(ii) A definition of the unusually hazardous or nuclear risks involved in the proposed contract or

program, with a statement that the parties have agreed to it;

(iii) A statement by responsible authority that the indemnification action would facilitate the national

defense;

(iv) A statement that the contract will involve unusually hazardous or nuclear risks that could impose

liability upon the contractor in excess of financial protection reasonably available;

(v) A statement that the contractor is complying with applicable Government safety requirements;

(vi) A statement of whether the indemnification should be extended to subcontractors; and

(vii) A description of any significant changes in the contractor's insurance coverage (see

50.104-3(a)(2)) occurring since submission of the indemnification request.

(2) Approval of a request to include the indemnification clause in a contract shall be by a

Memorandum of Decision executed by the appropriate official specified in 50.102-1(d).

(3) When use of the indemnification clause is approved under paragraph (b)(2) of this subsection,

the definition of unusually hazardous or nuclear risks (see paragraph (b)(1)(ii) of this subsection)

shall be incorporated into the contract, along with the clause.

(4) When approval is-

(i) Authorized in the Memorandum of Decision; and

(ii) Justified by the circumstances, the contracting officer may approve the contractor’s written

request to provide for indemnification of subcontractors, using the same procedures as those

required for contractors.

Parent topic: 50.104 Residual powers.