Also known as: Indefinite-Delivery, Indefinite-Quantity contract
A flexible federal contract vehicle for an indefinite quantity of supplies or services within stated limits over a fixed period.
Per FAR 16.504, "An indefinite-quantity contract provides for an indefinite quantity, within stated limits, of supplies or services during a fixed period. The Government places orders for individual requirements." An IDIQ (Indefinite-Delivery, Indefinite-Quantity) contract must specify a guaranteed minimum the government will order and a maximum orders cannot exceed, then the government draws down against it by issuing individual task or delivery orders as needs arise. For defense-tech startups, winning an IDIQ (or a slot on a multiple-award IDIQ) is often the gateway to sustained DoD revenue, because agencies can order repeatedly without re-competing the base contract — but only the stated minimum is guaranteed, so actual order volume and cash flow can be uncertain.
Source: FAR 16.504 (Acquisition.gov)
Only the stated contract minimum is guaranteed. Beyond that, the government orders as needed via task or delivery orders, so actual revenue — and cash flow — can vary widely, which matters for financial planning and coverage limits.
Definitions are educational and may be modified by your specific policy language, endorsements, and state rules. For regulatory guidance, refer to the California Department of Insurance or the NAIC.
Last updated: July 2026.