FEDERAL · 10 U.S.C. · Chapter 281
Assumption of uninsurable risk on certain contracts
10 U.S.C. § 3864
Title10 — Armed Forces
Chapter281 — CLAIMS AND DISPUTES
This text of 10 U.S.C. § 3864 (Assumption of uninsurable risk on certain contracts) is published on Counsel Stack Legal Research, covering United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Bluebook
10 U.S.C. § 3864.
Text
(a)In General.—The Secretary of Defense shall ensure that a contractor is not required to assume the risk of loss for work in process under a covered contract if, due to the classified nature of the performance of such contractor under such covered contract—
(1)such contractor is unable to obtain insurance for such risk of loss from a commercial provider; or
(2)a commercial provider is unable to process a claim of such contractor for loss of work in process under such covered contract.
(b)Limitations.—Subsection (a) shall not apply with respect to a loss of work in process under a covered contract to the extent that such loss—
(1)is the result of willful misconduct or lack of good faith on the part of the managerial personnel of the contractor, including with respect to the oversight
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History
(Added Pub. L. 119–60, div. A, title VIII, §801(a), Dec. 18, 2025, 139 Stat. 939.)
Editorial Notes
Editorial Notes
References in Text
The enactment of this Act, referred to in subsec. (c)(2), probably means the date of enactment of Pub. L. 119–60, which added this section and was approved Dec. 18, 2025.
Prior Provisions
Prior sections 3881 and 3882 were repealed by Pub. L. 85–155, title IV, §401(1), Aug. 21, 1957, 71 Stat. 390.
Section 3881, act Aug. 10, 1956, ch. 1041, 70A Stat. 222, authorized Secretary of the Army to retire regular commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps whose regular grade is below major.
Section 3882, act Aug. 10, 1956, ch. 1041, 70A Stat. 222, authorized Secretary of the Army to retire regular commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps whose regular grade is above captain.
Prior sections 3883 to 3886 were repealed by Pub. L. 96–513, title II, §216, title VII, §701, Dec. 12, 1980, 94 Stat. 2886, 2955, effective Sept. 15, 1981.
Section 3883, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Aug. 6, 1958, Pub. L. 85–600, §1(6), 72 Stat. 522; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115; Oct. 30, 1978, Pub. L. 95–551, §2, 92 Stat. 2069, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is below major general, other than a professor or the director of admissions of the United States Military Academy, be retired when he becomes 60 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3884, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is major general, and whose retirement under section 3923 of this title has been deferred under cl. (1) of that section, be retired when he becomes 60 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3885, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115, provided that, unless retired or separated at an earlier date or unless retained under section 3923(2) of this title, each commissioned officer whose regular grade is major general be retired when he becomes 62 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3886, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Aug. 6, 1958, Pub. L. 85–600, §1(7), 72 Stat. 522; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115; Oct. 30, 1978, Pub. L. 95–551, §2, 92 Stat. 2069, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is major general, and whose retirement under section 3923 of this title has been deferred under cl. (2) of that section, and each permanent professor and the director of admissions of the United States Military Academy, be retired when he becomes 64 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
A prior section 3887, act Aug. 10, 1956, ch. 1041, 70A Stat. 223, related to computation of years of service of commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps for purposes of retirement under former sections 3881 or 3882 of this title, or retirement pay under section 3991 of this title, prior to repeal by Pub. L. 85–155, title IV, §401(1), Aug. 21, 1957, 71 Stat. 390.
Prior sections 3888 and 3889 were repealed by Pub. L. 96–513, title II, §216, title VII, §701, Dec. 12, 1980, 94 Stat. 2886, 2955, effective Sept. 15, 1981.
Section 3888, acts Aug. 10, 1956, ch. 1041, 70A Stat. 223; Aug. 21, 1957, Pub. L. 85–155, title I, §101(18), 71 Stat. 379; May 20, 1958, Pub. L. 85–422, §11(a)(3), 72 Stat. 131; Sept. 2, 1958, Pub. L. 85–861, §1(96), 72 Stat. 1487, related to computation of service for determining retired pay of a commissioned officer of Regular Army retired under former section 3883, 3884, 3885, or 3886 of this title.
Section 3889, act Aug. 10, 1956, ch. 1041, 70A Stat. 224, provided that a member of Army retired under this chapter be entitled to retired pay computed under chapter 745 of this title.
Statutory Notes and Related Subsidiaries
Regulations
Pub. L. 119–60, div. A, title VIII, §801(b), Dec. 18, 2025, 139 Stat. 940, provided that: "Not later than 120 days after the date of the enactment of this Act [Dec. 18, 2025], the Secretary of Defense shall revise the Defense Federal Acquisition Regulation Supplement to carry out section 3864 of title 10, United States Code, as added by subsection (a)."
Editorial Notes
Prior Provisions
A prior chapter 283 "FOREIGN ACQUISITIONS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1828, and consisting of reserved section 3881, was repealed by Pub. L. 116–283, div. A, title XVIII, §1837, Jan. 1, 2021, 134 Stat. 4241, as amended by Pub. L. 117–81, div. A, title XVII, §1701(i)(8)(B), Dec. 27, 2021, 135 Stat. 2142.
Codification
Pub. L. 116–283, div. A, title XVIII, §1837, Jan. 1, 2021, 134 Stat. 4241, enacted this chapter "FOREIGN ACQUISITIONS", which consisted of subchapters I "General" and II "Prohibition on Contracting with the Enemy". Subchapter I consisted of section 3881 "Contracts: consideration of national security objectives", as transferred from section 2327 of this title, and subchapter II consisted of reserved sections 3891 to 3893. Subsequently, Pub. L. 117–81, div. A, title XVII, §1701(i)(8)(B), Dec. 27, 2021, 135 Stat. 2142, generally amended section 1837 of Pub. L. 116–283, effective as if included therein, so that this chapter would consist only of the chapter 283 designation and "[RESERVED]", thereby omitting the contents of this chapter in their entirety.
Editorial Notes
Prior Provisions
A prior chapter 285 "SMALL BUSINESS PROGRAMS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1828, and consisting of reserved section 3901, was repealed by Pub. L. 116–283, div. A, title XVIII, §1871(a)(1), Jan. 1, 2021, 134 Stat. 4287.
A prior chapter 287 "SOCIOECONOMIC PROGRAMS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1829, and consisting of reserved section 3961, was repealed by Pub. L. 116–283, div. A, title XVIII, §1838(a), Jan. 1, 2021, 134 Stat. 4242.
Amendments
2021—Pub. L. 117–81, div. A, title XVII, §1701(l)(1)(B), (v)(2)(B), Dec. 27, 2021, 135 Stat. 2144, 2154, amended Pub. L. 116–283, div. A, title XVIII, §1838(a), Jan. 1, 2021, 134 Stat. 4242, which added this analysis, by substituting "OTHER CONTRACTING" for "SOCIOECONOMIC" in chapter heading and "[Reserved]" for "Research and educational programs and activities: historically black colleges and universities and minority-serving institutions of higher education" in item 3904.
Statutory Notes and Related Subsidiaries
Demonstration Project for Contractors Employing Persons With Disabilities
Pub. L. 115–232, div. A, title VIII, §888, Aug. 13, 2018, 132 Stat. 1916, provided that: "Not later than 180 days after the date of the enactment of this Act [Aug. 13, 2018], the Secretary of Defense shall update the Defense Federal Acquisition Regulatory Supplement to include an instruction on the pilot program regarding employment of persons with disabilities authorized under section 853 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108–136; 10 U.S.C. 2302 note)."
Pub. L. 108–136, div. A, title VIII, §853, Nov. 24, 2003, 117 Stat. 1557, as amended by Pub. L. 108–199, div. H, §110, Jan. 23, 2004, 118 Stat. 438; Pub. L. 115–232, div. A, title VIII, §812(a)(2)(C)(i), Aug. 13, 2018, 132 Stat. 1846, provided that:
"(a) Authority.—The Secretary of Defense may carry out a demonstration project by entering into one or more contracts with an eligible contractor for the purpose of providing defense contracting opportunities for severely disabled individuals.
"(b) Evaluation Factor.—In evaluating an offer for a contract under the demonstration program, the percentage of the total workforce of the offeror consisting of severely disabled individuals employed by the offeror shall be one of the evaluation factors.
"(c) Credit Toward Certain Small Business Contracting Goals.—Department of Defense contracts entered into with eligible contractors under the demonstration project under this section, and subcontracts entered into with eligible contractors under such contracts, shall be credited toward the attainment of goals established under section 15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1)) regarding the extent of the participation of disadvantaged small business concerns in contracts of the Department of Defense and subcontracts under such contracts.
"(d) Definitions.—In this section:
"(1) Eligible contractor.—The term 'eligible contractor' means a business entity operated on a for-profit or nonprofit basis that—
"(A) employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over a period prescribed by the Secretary;
"(B) pays not less than the minimum wage prescribed pursuant to section 6 of the Fair Labor Standards Act of 1938 (29 U.S.C. 206) to the employees who are severely disabled individuals; and
"(C) provides for its employees health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.
"(2) Severely disabled individual.—The term 'severely disabled individual' means an individual with a disability (as defined in section 3 of the Americans with Disabilities Act of 1990 (42 U.S.C. 12102)) who has a severe physical or mental impairment that seriously limits one or more functional capacities."
References in Text
The enactment of this Act, referred to in subsec. (c)(2), probably means the date of enactment of Pub. L. 119–60, which added this section and was approved Dec. 18, 2025.
Prior Provisions
Prior sections 3881 and 3882 were repealed by Pub. L. 85–155, title IV, §401(1), Aug. 21, 1957, 71 Stat. 390.
Section 3881, act Aug. 10, 1956, ch. 1041, 70A Stat. 222, authorized Secretary of the Army to retire regular commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps whose regular grade is below major.
Section 3882, act Aug. 10, 1956, ch. 1041, 70A Stat. 222, authorized Secretary of the Army to retire regular commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps whose regular grade is above captain.
Prior sections 3883 to 3886 were repealed by Pub. L. 96–513, title II, §216, title VII, §701, Dec. 12, 1980, 94 Stat. 2886, 2955, effective Sept. 15, 1981.
Section 3883, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Aug. 6, 1958, Pub. L. 85–600, §1(6), 72 Stat. 522; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115; Oct. 30, 1978, Pub. L. 95–551, §2, 92 Stat. 2069, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is below major general, other than a professor or the director of admissions of the United States Military Academy, be retired when he becomes 60 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3884, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is major general, and whose retirement under section 3923 of this title has been deferred under cl. (1) of that section, be retired when he becomes 60 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3885, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115, provided that, unless retired or separated at an earlier date or unless retained under section 3923(2) of this title, each commissioned officer whose regular grade is major general be retired when he becomes 62 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
Section 3886, acts Aug. 10, 1956, ch. 1041, 70A Stat. 222; Aug. 6, 1958, Pub. L. 85–600, §1(7), 72 Stat. 522; Nov. 2, 1966, Pub. L. 89–718, §3, 80 Stat. 1115; Oct. 30, 1978, Pub. L. 95–551, §2, 92 Stat. 2069, provided that, unless retired or separated at an earlier date, each commissioned officer whose regular grade is major general, and whose retirement under section 3923 of this title has been deferred under cl. (2) of that section, and each permanent professor and the director of admissions of the United States Military Academy, be retired when he becomes 64 years of age, except as provided by section 8301 of title 5. See section 1251 of this title.
A prior section 3887, act Aug. 10, 1956, ch. 1041, 70A Stat. 223, related to computation of years of service of commissioned officers of Army Nurse Corps or Women's Medical Specialist Corps for purposes of retirement under former sections 3881 or 3882 of this title, or retirement pay under section 3991 of this title, prior to repeal by Pub. L. 85–155, title IV, §401(1), Aug. 21, 1957, 71 Stat. 390.
Prior sections 3888 and 3889 were repealed by Pub. L. 96–513, title II, §216, title VII, §701, Dec. 12, 1980, 94 Stat. 2886, 2955, effective Sept. 15, 1981.
Section 3888, acts Aug. 10, 1956, ch. 1041, 70A Stat. 223; Aug. 21, 1957, Pub. L. 85–155, title I, §101(18), 71 Stat. 379; May 20, 1958, Pub. L. 85–422, §11(a)(3), 72 Stat. 131; Sept. 2, 1958, Pub. L. 85–861, §1(96), 72 Stat. 1487, related to computation of service for determining retired pay of a commissioned officer of Regular Army retired under former section 3883, 3884, 3885, or 3886 of this title.
Section 3889, act Aug. 10, 1956, ch. 1041, 70A Stat. 224, provided that a member of Army retired under this chapter be entitled to retired pay computed under chapter 745 of this title.
Statutory Notes and Related Subsidiaries
Regulations
Pub. L. 119–60, div. A, title VIII, §801(b), Dec. 18, 2025, 139 Stat. 940, provided that: "Not later than 120 days after the date of the enactment of this Act [Dec. 18, 2025], the Secretary of Defense shall revise the Defense Federal Acquisition Regulation Supplement to carry out section 3864 of title 10, United States Code, as added by subsection (a)."
Editorial Notes
Prior Provisions
A prior chapter 283 "FOREIGN ACQUISITIONS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1828, and consisting of reserved section 3881, was repealed by Pub. L. 116–283, div. A, title XVIII, §1837, Jan. 1, 2021, 134 Stat. 4241, as amended by Pub. L. 117–81, div. A, title XVII, §1701(i)(8)(B), Dec. 27, 2021, 135 Stat. 2142.
Codification
Pub. L. 116–283, div. A, title XVIII, §1837, Jan. 1, 2021, 134 Stat. 4241, enacted this chapter "FOREIGN ACQUISITIONS", which consisted of subchapters I "General" and II "Prohibition on Contracting with the Enemy". Subchapter I consisted of section 3881 "Contracts: consideration of national security objectives", as transferred from section 2327 of this title, and subchapter II consisted of reserved sections 3891 to 3893. Subsequently, Pub. L. 117–81, div. A, title XVII, §1701(i)(8)(B), Dec. 27, 2021, 135 Stat. 2142, generally amended section 1837 of Pub. L. 116–283, effective as if included therein, so that this chapter would consist only of the chapter 283 designation and "[RESERVED]", thereby omitting the contents of this chapter in their entirety.
Editorial Notes
Prior Provisions
A prior chapter 285 "SMALL BUSINESS PROGRAMS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1828, and consisting of reserved section 3901, was repealed by Pub. L. 116–283, div. A, title XVIII, §1871(a)(1), Jan. 1, 2021, 134 Stat. 4287.
A prior chapter 287 "SOCIOECONOMIC PROGRAMS", as added by Pub. L. 115–232, div. A, title VIII, §801(a), Aug. 13, 2018, 132 Stat. 1829, and consisting of reserved section 3961, was repealed by Pub. L. 116–283, div. A, title XVIII, §1838(a), Jan. 1, 2021, 134 Stat. 4242.
Amendments
2021—Pub. L. 117–81, div. A, title XVII, §1701(l)(1)(B), (v)(2)(B), Dec. 27, 2021, 135 Stat. 2144, 2154, amended Pub. L. 116–283, div. A, title XVIII, §1838(a), Jan. 1, 2021, 134 Stat. 4242, which added this analysis, by substituting "OTHER CONTRACTING" for "SOCIOECONOMIC" in chapter heading and "[Reserved]" for "Research and educational programs and activities: historically black colleges and universities and minority-serving institutions of higher education" in item 3904.
Statutory Notes and Related Subsidiaries
Demonstration Project for Contractors Employing Persons With Disabilities
Pub. L. 115–232, div. A, title VIII, §888, Aug. 13, 2018, 132 Stat. 1916, provided that: "Not later than 180 days after the date of the enactment of this Act [Aug. 13, 2018], the Secretary of Defense shall update the Defense Federal Acquisition Regulatory Supplement to include an instruction on the pilot program regarding employment of persons with disabilities authorized under section 853 of the National Defense Authorization Act for Fiscal Year 2004 (Public Law 108–136; 10 U.S.C. 2302 note)."
Pub. L. 108–136, div. A, title VIII, §853, Nov. 24, 2003, 117 Stat. 1557, as amended by Pub. L. 108–199, div. H, §110, Jan. 23, 2004, 118 Stat. 438; Pub. L. 115–232, div. A, title VIII, §812(a)(2)(C)(i), Aug. 13, 2018, 132 Stat. 1846, provided that:
"(a) Authority.—The Secretary of Defense may carry out a demonstration project by entering into one or more contracts with an eligible contractor for the purpose of providing defense contracting opportunities for severely disabled individuals.
"(b) Evaluation Factor.—In evaluating an offer for a contract under the demonstration program, the percentage of the total workforce of the offeror consisting of severely disabled individuals employed by the offeror shall be one of the evaluation factors.
"(c) Credit Toward Certain Small Business Contracting Goals.—Department of Defense contracts entered into with eligible contractors under the demonstration project under this section, and subcontracts entered into with eligible contractors under such contracts, shall be credited toward the attainment of goals established under section 15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1)) regarding the extent of the participation of disadvantaged small business concerns in contracts of the Department of Defense and subcontracts under such contracts.
"(d) Definitions.—In this section:
"(1) Eligible contractor.—The term 'eligible contractor' means a business entity operated on a for-profit or nonprofit basis that—
"(A) employs severely disabled individuals at a rate that averages not less than 33 percent of its total workforce over a period prescribed by the Secretary;
"(B) pays not less than the minimum wage prescribed pursuant to section 6 of the Fair Labor Standards Act of 1938 (29 U.S.C. 206) to the employees who are severely disabled individuals; and
"(C) provides for its employees health insurance and a retirement plan comparable to those provided for employees by business entities of similar size in its industrial sector or geographic region.
"(2) Severely disabled individual.—The term 'severely disabled individual' means an individual with a disability (as defined in section 3 of the Americans with Disabilities Act of 1990 (42 U.S.C. 12102)) who has a severe physical or mental impairment that seriously limits one or more functional capacities."
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10 U.S.C. § 3864, Counsel Stack Legal Research, https://law.counselstack.com/usc/10/3864.