The U.S. Department of Labor today published a notice providing enhanced and transparent guidance for calculating the amount of securitization required by insurers writing policies under the Longshore and Harbor Workers’ Compensation Act.
This new guidance represents a transparent and structured approach that will lower the cost of doing business for industries vital to America’s economic and military dominance while continuing to put injured workers first. It will also improve industry confidence regarding potential liabilities and how to improve their outcomes. Among the factors that are considered are the company’s financial health, experience writing LHWCA policies, and how quickly they pay accepted claims for injured workers.
“As we restore America’s maritime and energy dominance, the Department of Labor continues to put American workers’ safety and health first,” said Secretary of Labor Lori Chavez-DeRemer. “These guidelines will protect workers while creating a fairer environment for businesses that do vital work for our country.”
Publishing this guidance advances the department’s goal of protecting injured workers while reducing the burden on job-creating industries and promoting economic growth.
Administered by the department’s Office of Workers’ Compensation Programs, the LHWCA and its extensions require private-sector firms to provide workers’ compensation coverage for their employees engaged in covered positions. Insurance companies that are approved by OWCP to write policies under the acts must provide appropriate security to the department for their liabilities. While the LHWCA has always allowed companies to reduce their security burden if they meet certain risk- and performance-based criteria, action has never been taken to provide this relief.
In alignment with President Trump’s Executive Order, “Restoring America’s Maritime Dominance,” this action will reduce the economic and regulatory burden on shipbuilders by lowering the cost of insurance and helping American-built ships to better compete with foreign competitors.
Read the Guidance for Insurance Carrier Security Deposit Requirements, which is scheduled for publication in the Feb. 9, 2026, edition of the Federal Register.