Passed on December 2, 1942 under the original title, "Compensation for Injury, Death, or Detention of Employees of Contractors with the United States Outside the United States", The War Hazards Compensation Act, 42 U.S.C. 1710 et seq., was established to provide a regulatory framework aimed at reimbursing insurance carriers who paid claims proximately caused by war-risk hazards. By statute, a war-risk hazard is defined as any hazard arising during a war or armed conflict in which the United States is engaged, including:
(1) The discharge of any missile, harmful liquids, noxious gas, or the use of any weapon, explosive, or other “noxious thing” by a hostile force during the combating of an attack or an imagined attack;
(2) Action of a hostile force, including rebellion or insurrection against the United States or any of its allies;
(3) The discharge or explosion of munitions intended for use in connection with a war;
(4) The collision of military vessels in convoy or the operation of vessels or aircraft; or
(5) The operation of an aircraft, boat, helicopter or other vessels in a “zone of hostilities” or engaged in war time activities.
Should the insurance company provide adequate evidentiary support in their application for relief under the War Hazards Compensation Act, the Department of Labor’s Division of Federal Employment Compensation (“DFEC”) will issue reimbursement of all temporary total disability compensation benefits, permanent partial disability compensation benefits, permanent total disability compensation benefits, medical expenses, death benefits, funeral expenses, claims expenses associated with processing the claim, and unallocated claims expenses amounting to 15% of all past paid compensation and medical benefits.
The War Hazards Compensation Act also extends direct benefits to defense contractors who are kidnapped, detained or killed by insurgents while working overseas. Benefits are payable by the government for the duration of the employee’s detention, regardless of whether or not they were engaged in the course and scope of their employment at the time of their kidnapping. Such benefits are made payable to the dependents of the detained employee until they are released, or death can be presumed by the Department of Labor.