that it was not the policy of the Commission to approve or requireany bond or insurance coverage on the part of its integrated contractors except Workmen's Compensation and Public Liability. H & HN was also advised that the nature of the work at the Project site would bear a security classification precluding both the designation of job classifications con~ forming to the Compensation Insurance Manuals and the normal audit of pay- rells by the Insurance Auditors. Representatives of the Commission advised that an established arrangement existed between the various integrated con- tractors of the ABC and the major casualty insurance companies, whereby provisional premiums were paid and at periodic intervals adjusted to actual claima paid, plus direct costs of administering and processing the claims, and plus percentage factors to cover fees. Effective January 31, 1949, just prior to the departure of the first contingent of employees for Jobsite, the Insurance Carriers issued binders serving as temporary overseas Jobsite Workmen's Compensation and Comprehensive Liability policies, pending negotiation and issuance of a de- finitive policy with endorsements as required by the AKC. It ultimately became obvious that it was impractical to handle the insurance negotiations by correspondence between the Carrier's San Fran- cisco Office, the AEC at Los Alamos, the Chief of the AEC Insurance Branch in Washington, the H & N insurance advisor, and H& N im Les Angeles. In December 1949, the H & N Controller travelled to Washington for a confer- ence with representatives of the Commission and the Carrier in order to expedite the issuance of formal policies conforming to the requirements of all concerned. It was also necessary to obtain the comcurrence of the Director of the Bureau of Exmployees' Compensation, Federal Security Agency, the governmental bureau charged with responsibility for administering clains in accordance with the provisions of the Longshoremen‘s and Harbor Worker's Act, as amended and extended by the Defense Base Act in Public Law 787 - Tith Congress, the governing statute on compensation insurance coverage for everseas projects. Agreements were reached satisfactory to the government agencies involved, the Insurance Carriers, and H & N Management. Early in 1950, the formal overseas policies were issued, dating from January 31, 1949, the effective date of the interim binders. No problems were involved im securing on-continent coverage where the classifications of employees and payroll statistics and records vere unclassified and could be made available to the Insurance Anditers. This eliminated the mecessity for a cest-plus-percentage arrangement fer oncontinent casualty coverage. Stamdard policies were issued, effective September 17, 1948, covering both Workmen's Compensation and Comprehensive Public Liability. Required coverage, as specified above, was continued throughout the life of the preject, and as of June 30, 1951, the claims ratio was, ac- cording to the Carrier, extremely low for a project of this nature, oncontinent or elsewhere. Although disallowed as a reimbursible item of expense by the AK, a Blanket Position Bond has bees maintained continuously im force during 11-35