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Liability Insurance for Federal Employees and Contractors


Q: As a federal employee acting within the scope of my employment, why would I need FEDS PLI coverage for a civil suit?
Civil suits in which you can be held liable for a financial judgment or possibly need to hire your own attorney are often referred to as Bivens Actions, Constitutional torts, Personal Capacity or Individual Capacity Lawsuits. You don’t have absolute immunity for these types of lawsuits like you do for common law torts filed under the Federal Tort Claims Act (FTCA). Also, DOJ representation is not mandatory and it is not automatic for these types of lawsuits - and you can be held personally liable even if DOJ represents you.
  • The FEDS policy will appoint an attorney to defend you in these personal capacity lawsuits when DOJ exercises its discretion not to provide defense.
  • The FEDS policy may also appoint coverage counsel to monitor DOJ’s defense of you.
  • If DOJ is on the fence as to whether it will defend, FEDS may hire coverage counsel to try and convince DOJ to provide the defense.
  • FEDS may also hire coverage counsel to monitor DOJ’s defense of you in certain sensitive cases where we think there may be extra liability.
  • And finally, the FEDS policy provides indemnification up to $1,000,000 or $2,000,000 to pay any judgment if you are found liable and your agency denies indemnification.
If you are making decisions that could result in your being sued in the performance of your duties, it is important to understand Representation; Immunity; and Indemnification, as summarized here:

Representation - Who is going to defend you? DOJ representation is not mandatory. DOJ representation is not automatic.
Immunity – You have absolute immunity under the Federal Tort Claims Act (FTCA) for common law torts. You do not, however, have absolute immunity for constitutional torts and/or personal capacity lawsuits. If you are sued in your personal capacity, you only have qualified immunity.
Indemnification - Even if DOJ provides representation, what you need to understand is that it is still a lawsuit against you personally. Therefore, you could still be liable for the judgment. Requirements for indemnification include (1) acting within your federal scope; (2) indemnifying is in the best interests of the US; and (3) your agency has regulations governing the indemnification process. The FEDS policy provides defense and indemnification up to $1,000,000 or $2,000,000 if you are found liable and need to pay a judgment.

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