War Risks P&I Excess cover and Bio-Chem cover for the 2021/22 policy year – International Group arrangements

WAR RISKS P&I EXCESS COVER

Although war risks are excluded from standard P&I cover (Rule 30.4.1), Assuranceforeningen Skuld (Gjensidig) (“the Association”), in conjunction with other P&I Clubs in the International Group, continues to provide War Risks P&I Excess Cover on the same basis as in the 2020/21 policy year for Members entered on a full mutual basis.

The limit of cover remains at USD 500 million. The cover is subject to an excess of the proper value of the entered vessel, or whatever sums are recoverable from other war risks covers. We remind of the change introduced in the 2020 policy year in respect of the minimum excess of the policy which has increased from the proper value of the entered ship (as agreed by the relevant Association) or USD 100 million whichever is the less, to the proper value of the entered ship (as agreed by the relevant Association) or USD 500 million whichever is the less.

The full wording reads as follows:

“This policy to pay claims excess of amounts recoverable under vessels’ war or crew war risks Protection and Indemnity policies subject to a minimum excess of the proper value of the entered ship (as agreed by the relevant Association) or USD 500 million whichever is the less (applicable to owners’ entries and not to Charterers’ entries), and further subject to a minimum excess of USD 50,000 any one event.”

Members should note that they are deemed to have underlying cover with conditions equivalent to the cover above (“P&I – War Risks”) equal to at least the proper value of the ship. Furthermore, this cover is excess of any cover which the Member has actually taken out which covers the risk, unless the cover is a corporate general liability umbrella cover.

Members who have ships valued individually at more than USD 100 million and who do not purchase primary war risks insurance will have a larger gap in their cover from the 2020 policy year (to fund for their own account). Members are therefore recommended to review their war risks arrangements to ensure they are aware of their exposures in respect of any ship valued at more than USD 100 million.

The cover is subject to a deductible of USD 50,000 any one event each vessel.

The cover is for P&I risks as set out in Part II of Skuld’s Rules and which are excluded from standard cover by virtue of the war risks exclusion in Rule 30.4.1. The cover is subject to the Statutes and Rules (save for the exclusion in Rule 30.4.1) and to any terms and conditions separately agreed with members.