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Allowability of Cost for Insurance


Nutrition Services Division Management Bulletin

To: Child and Adult Care Food Program Sponsors

Number: 05-210

Attention: Food Program Director

Date: May 2005

Subject: Allowability of Cost for Directors' and Officers' Insurance in the Child and Adult Care Food Program (CACFP)

Reference: United States Department of Agriculture Child and Adult Care Food Program Policy Memo 04-17

This Management Bulletin addresses the extent to which directors' and officers' (D&O) insurance is an allowable administrative cost in the Child and Adult Care Food Program (CACFP).

The cost of D&O insurance is an allowable CACFP administrative cost, provided that the following conditions apply:

  1. The insurance policy actually provides CACFP liability coverage (many policies specifically exclude coverage related to the administration of a Federal program).
  2. The CACFP’s share of the cost is properly allocated, if cost allocation is appropriate.

Therefore, we strongly urge institutions to consider the provisions and exclusions of any insurance policy before purchasing insurance.

If you have any questions, please contact the CACFP specialist assigned to your agency in the Child Nutrition Information Payment System (CNIPS). You will find a list of contact information for specialists in the Download Forms section of the CNIPS. You may also contact the Help Desk by phone at 800-952-5609, option 6.

Questions:   Nutrition Services Division | 800-952-5609
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