§2645 Indemnification of Department of Transportation for Losses Covered by Vessel War Risk Insurance

Summary

The Secretary of Defense must quickly repay the Secretary of Transportation for losses covered by vessel war risk insurance under their agreement. If the loss is for a vessel, payment must be made no later than 90 days after Transportation says the claim is payable or amounts are due under the policy. For any other claim, payment must be made no later than 180 days after Transportation says the claim is payable. While a vessel loss claim is pending, the Secretary of Transportation may make required periodic payments to a lessor or mortgagee, starting no later than 30 days after the claim is filed. If the claim is allowed, those payments count toward the insurance payout. If the claim is denied, those payments become a debt to the United States and must be returned to the insurance fund or account used. The Secretary of Defense may use Department of Defense operation and maintenance funds and may transfer needed sums to Transportation. Money transferred goes into the Vessel War Risk Insurance Fund. If a covered loss is or is expected to be over $10,000,000, the Secretary of Defense must tell Congress as soon as possible and no later than 30 days after the loss. These payments do not need certain prior notices to Congress that some other laws require, and claims do not have to be combined before payment. Definitions: “vessel war risk insurance” — insurance issued by Transportation under chapter 539 of title 46, provided without premium at Defense’s request and covered by the indemnity agreement; “Vessel War Risk Insurance Fund” — the fund in 46 U.S.C. 53909(a); “loss” — property damage, injury or death, and other covered liabilities and costs.