The Commentary was amended in 2016 to remove some history and references to the special cover provided by the Norwegian Shipowner’s Mutual War Risks Insurance Association in Chapter 15.
As mentioned in Cl. 2-8, the total range of perils in marine insurance is divided into two. Separate insurances must be taken out against perils related to war and against general marine perils. In practice the terms “war perils” and “marine perils”, “war-risk insurance” and “marine-risk insurance” are used. The Plan has adopted this terminology and therefore uses the term “marine perils” to cover the “civilian” perils which occur in the shipping trade.
The Plan maintains the traditional division of the range of perils into war-risk insurance and marine-risk insurance. Due to the fact that the exception for war perils in marine-risk insurance relates to the range of perils in war risk insurance (cf. Cl. 2-8 (a)), no gaps in cover will occur other than those that follow from explicit provisions.
Technically, war perils constitute an exception in general marine insurance. The insurer against marine perils is liable for “all perils to which the interest insured is exposed”, with the exception of inter alia war perils. In war-risk insurance, on the other hand, the range of perils is positively determined, and will (as a rule) comprise most of the perils excluded by the war-risk exception. However, this wording does not entail that general principles of insurance law, such as the principle that excluded perils should be subject to strict interpretation and that the insurer has the burden of proving that the loss is caused by a peril which is explicitly excluded from the cover, cf. Cl. 2-12, sub-clause 2, shall apply. War-risk and marine-risk insurances shall in every respect be regarded as equal types of insurances on the same level. The excluded war peril shall not be subject to a strict interpretation to the disadvantage of the marine-risk insurers and, from an evidential point of view, there is no difference.
Sub-clause 1 of Cl. 2-9 states the range of perils in war-risk insurance in (a) - (e).
Sub-clause 1 (a) states the “classic” war peril. The crucial element is obviously the perils caused by a war in progress. To give an exhaustive enumeration of the events which may be relevant here is not possible. Primarily there is the use of implements of war by the powers at war (or neutral powers) - bombs, torpedoes and other conventional firearms, chemical or biological implements of war, and the like. If the damage is directly attributable to the use of such an implement of war for the purpose of war, the loss is subject to the special causation rule contained in Cl. 2-13, cf. below. But also otherwise, the use of implements of war may be the cause of a loss such as when the ship has to pass through dangerous waters in order to avoid a mine field or, in order to stay away from an area where a sea battle or an air raid is taking place, and in the process runs aground.
An implement of war may be the cause of damage also after the war in which the implement was used has ceased, e.g. where a ship runs into a mine. Such damage shall also be regarded as “a peril attributable to war”, regardless of whether or not the mine explodes. If the impact does not result in an explosion it may, however, be difficult to prove whether the impact is attributable to the implement of war or a common marine peril, e.g. a log. In that event the rule of apportionment in Cl. 2-16 may have to be applied.
Generally, all such measures that are regularly taken by powers at war as well as by neutral powers and which affect shipping, such as the extinguishing of lighthouses, the withdrawal of old navigation marks and the putting out of new ones, the organising of convoys where the freedom to manoeuvre is more or less restricted, orders to sail without navigation lights, etc., will constitute war perils, due to the fact that they are attributable to the war, cf. the wording of the Plan.
As for capture at sea, requisitions and the like undertaken for the purpose of war, and sabotage carried out to further the purpose of a power at war, these are perils directly attributable to the war and therefore come under the definition in Cl. 2-9 sub-clause 1 (a). However, these perils are also covered by the special enumeration in sub-clause 1 (b); between (a) and (b) there will thus be an overlapping as far as war-motivated measures are concerned. However, if the measure is taken by the ship’s own (not “foreign”) State power, the special rule contained in sub-clause 1 (b) must prevail. Such measures will therefore fall outside the cover, regardless of whether or not they are war-motivated. If, in exceptional cases, the war-risk insurer has not accepted liability for the perils mentioned in sub-clause 1 (b) and (c), it will be a matter of construction to decide whether he must nevertheless be liable under sub-clause 1 (a) for war-motivated measures by a foreign State power and war-motivated sabotage.
The term “war-like conditions” is used to imply that the decisive point is not whether war has broken out or threatens to break out, but how war-like the measures are which a State has instituted. Whether there are “war-like conditions” may, of course, be difficult to decide, but in practice the term will hardly be of any great significance. As a rule, the loss will have been caused either by military manoeuvres or by measures taken by State power, and in either case it will be covered by the war-risk insurer, even if there are no “war-like conditions”. If a ship which is in international waters or within the territorial borders of a foreign state, becomes the subject of a simulated or real air raid by the relevant foreign state, this must normally be regarded as a war peril. Exceptions are nevertheless conceivable where the action must be viewed as part of the enforcement of the relevant state's police or customs legislation, see below under sub-clause 1 (b).
A “civil war” will normally constitute a “war-like condition”, and the addition is therefore more in the nature of a specification than an amendment. An example of losses that are covered under this alternative is where aircraft from rebel forces in a civil war drop bombs that hit neutral ships, cf. the situation during the Spanish civil war, when bombs dropped in the summer of 1936 struck the Norwegian ship D/S Frank.
The war-risk insurer is also liable for “the use of arms or other implements of war in the course of military manoeuvres in peacetime or in guarding against infringements of neutrality”. The main problem here will be to decide when there is a case of “use of . . . other implements of war”. If a ship collides with a naval vessel sailing in a perfectly ordinary manner, this will not constitute any use of implements of war. The same applies if, for example, a military plane crashes in a harbour due to engine trouble, or an ammunition depot blows up as a result of an ordinary “civilian” fire. The “use of implements of war” presupposes that the naval vessel (the aircraft, the ammunition) is used in a manner typical of its function as an implement of war, e.g., that during exercises the naval vessel disregards the rules relating to navigation at sea, that the aircraft crashes during dive-bombing exercises, or the ammunition stores blow up as a result of a failure to comply with the relevant safety regulations.
An important question is how to evaluate the mistakes which the crew makes under the influence of the war situation. A war will normally make navigation conditions much more difficult than in times of peace. More concentration and alertness are required of the crew (e.g., while sailing in waters where lighthouses and navigation marks are out of operation), and an insignificant and excusable misjudgement may easily have disastrous consequences. In addition, the physical and mental pressure involved in wartime sailing may easily cause exceptional fatigue or other indisposition among officers and crew.
In the extensive case law during and after World War II it was regarded as clear that any faults or negligence committed by the master or crew relating strictly to their service as seamen should be regarded as an independent peril which fell within the marine-risk insurer’s area of liability. In this respect international tradition was followed. This approach was maintained in the 1996 Plan. Faults or negligence committed by the master or crew shall therefore be regarded as an independent causal factor, a peril which falls within the marine-risk insurer’s area of liability. As the chances of faults and negligence being committed will, as a rule, be far greater in times of war than in times of peace because navigation is that much more difficult, this in actual fact means that also the marine-risk insurer must accept a general increase in risk owing to the war situation.
However, it is conceivable that faults or negligence on the part of the master or crew must be covered by the war-risk insurer, viz. where such fault or negligence is very closely bound up with the war peril or consists in a misjudgement of this peril. It is, for example, conceivable that the officers are exhausted after having been subjected to the pressure of war for a long period of time and, as a result thereof, make a clear navigational error, or that the crew leaves the ship under the misapprehension that there is an impending risk of war (cf. the “Solglimt case”, Rt. 1921. 424). In practice, it is also conceivable that the reasons given for the judgment will be that the crew’s conduct in the given circumstances must be regarded as excusable; in other words, that no actual “fault or negligence” has been committed.
Moreover, when applying Cl. 2-9 sub-clause 1 (a), guidance will be found in the abundant case law relating to those ships that sailed in Norwegian and other German-controlled waters during World War II.
Sub-clause 1 (b) of Cl. 2-9 deals with both measures that are related to a war in progress or an impending war, and those that have no direct connection with war or war perils. As mentioned above, strict war measures - such as confiscation – will, according to the wording, also be covered as manifestations of the general war perils under sub-clause 1 (a). However, as a special provision, sub-clause 1 (b) will prevail.
The term “capture at sea” covers the situation where the insured ship is stopped at sea by a battleship or some other representative of the relevant State power using power or threatening to do so, and taken into port for further control.
Earlier versions also included “condemnation in prize”. The term sounds archaic now, and must be regarded as being covered by the term “confiscation”, which is explicitly mentioned. Both “condemnation in prize” and “confiscation” mean an appropriation of the ship by a State power without compensation. In the case of condemnation in prize, however, a warring power will invoke international or domestic condemnation in prize rules. This will still be included in the term “confiscation”; it is not the intention to make any change in the substantive cover.
The term “requisition” is also an enforced acquisition of the ship by government authorities, but the difference between requisition and confiscation is that, in principle, compensation is payable for the loss caused by the acquisition. This means that requisition is in actual fact the same as expropriation. As will appear from sub-clause 1 (b), third sentence, requisition for ownership or use will, as a rule, not be covered by a war-risk insurance.
Requisition as an intervention typically occurs in times of war or in times of war-like conditions, or during a political crisis. A general criterion for defining requisition as a war peril is therefore that the intervention is politically motivated. If the State expropriates the ship for other reasons, for instance, pursuant to quarantine provisions to prevent the spread of a virus, this does not constitute “requisition” in accordance with this provision.
The term “other similar interventions” indicates that the enumeration in sub-clause 1 (b) is not exhaustive, and that also other types of interventions by a State power may be included. At the same time, the term implies a limitation as regards the nature of the interventions covered. The wording is aimed at excluding from the war-risk cover the types of interventions that are made as part of the enforcement of customs and police legislation. The war-risk insurance therefore does not cover losses arising from the ship being detained by the authorities because there may be doubt as to whether the ship is compliant with the rules regarding technical and operational safety, or because the crew is suspected of smuggling. Obviously, losses arising from the ship being detained or seized as part of debt-recovery proceedings against the owners are not covered, either; this follows from the fact that “insolvency” has been excluded in sub-clause 2 (a). This means that losses arising from measures taken by the police authorities must be covered by the ordinary marine-risk insurance to the extent that these losses are recoverable, cf. the comments above on Cl. 2-8 (b). The loss will often consist of loss of time or general capital loss, for which the insurer is not liable. However, assuming, for example, that the vessel sustains damage during an extensive customs examination, the hull insurers against marine perils must cover the damage, provided that the examination was not caused by the assured’s own negligence.
That difficult borderline problems may arise is demonstrated by two arbitration awards (unpublished award of 11 June 1985 relating to the Germa Lionel award and ND 1988.275 NV Chemical Ruby), and a case that was settled (the Wildrake case). All of these are cited and commented on in Brækhus/Rein: Håndbok i kaskoforsikring (Handbook of Hull Insurance), pp. 73-76. These decisions show that cover under the war-risk insurance is contingent on the shipowner being divested of the right of disposal of the ship, the authorities clearly exceeding the measures necessary in order to enforce police and customs legislation, and the intervention being motivated by primarily political objectives. Under the 1964 Plan, insurance against war perils did not cover interventions by Norwegian authorities, or by authorities of countries allied with Norway. However, under the definition in the clause of “a foreign State power”, interventions by persons or organisations who unlawfully passed themselves off as a Norwegian or allied State power (e.g., a Quisling government) were covered by the war-risk insurance. During the revision of the 1996 Plan, the issue of whether it would be possible to extend the war-risk cover to include interventions by Norwegian or allied State powers was considered. However, the Norwegian Shipowners’ Mutual War Risks Insurance Association and the other war-risk insurers reached the conclusion that it would be difficult to cover interventions by Norwegian government authorities. One thing was that the existence of such an insurance might easily influence the assured’s position in relation to the authorities. According to ordinary principles of expropriation law, the requisitioner must pay full compensation for the subject-matter requisitioned or - in the case of requisition for use - cover liability and any damage and reduction in value which the subject-matter of the requisition has suffered during the period of requisition. In this manner the losses caused by the intervention are distributed through society in general. If the loss had already been apportioned by means of insurance, there would be an obvious risk that the authorities (or the legislator) would attach less importance to the economic settlement with the person who was the victim of the intervention. Even more important, however, was the fact that such extension of the range of perils under the war-risk insurance would require a guarantee that the reinsurance market was willing to accept it. Such a guarantee was unobtainable. On the other hand, the war-risk insurers felt that there was nothing to prevent an extension of the cover as regards interventions by allied State powers.
Based on an overall assessment, where also the insurance pattern currently seen in war-risk insurance was taken into account (see above for further details), the Committee decided on the arrangement outlined in Cl. 2-9, sub-clause 1 (b), seen in conjunction with Cl. 2-8 (b), under which interventions by foreign State powers are covered by the war-risk insurer.
The term “State power” is defined in Cl. 2-8 (b). It also comprises persons or organizations exercising “supranational authority”. Hence, if an intervention is implemented by representatives of a league of States (alliance, group, block), it must be regarded as an intervention by a State power. A requisition by NATO or a similar organization will accordingly not be covered by the insurance against marine perils under Cl. 2-8 (b).
The term “foreign State power” is defined in Cl. 2-9, sub-clause 1 (b), second sentence. The concept is structured so that on the one hand it covers all States with some exceptions. These exceptions apply, firstly, to the State power in the ship’s State of registration and, secondly, to State powers in the country where the controlling ownership interests in the ship are located. The term “State of registration” is not without its ambiguities in the event of so-called double registration in connection with bareboat chartering. However, in the event of double registration in both the owner State and the bareboat-charterer State, both States must be regarded as “the State of registration” for the purpose of this provision. As regards the term “controlling ownership interests”, the vital question will normally be in what country the largest proportion of the ownership interests are located. However, the term opens the door to a discretionary assessment, where other elements, such as limitations on voting rights, the composition of the ownership interests, co-operation arrangements etc. may lead to the conclusion that the controlling ownership interests are located in another country.
On the other hand, not only ordinary State powers are brought in under this term, but also all persons and organisations which unlawfully pass themselves off as being authorised to exercise public or supranational authority. In the case of interventions by groups of rebels insurgents it may at times be doubtful whether the situation is covered by the wording or whether it is a case of pure piracy. However, in practice this will normally not create difficulties, as Cl. 2-9, sub-clause 1 (d) also refers piracy to the war-risk insurer’s scope of cover.
Sub-clause 1 (b) deals only with restrictions on the owner’s rights in the object insured. Actions leading to an infliction of physical damage fall within the scope of general war perils set forth in sub-clause 1 (a); there is accordingly no limitation applicable to actions by authorities of the State of registration or the State of ownership. If the object is destroyed by entities from these States during acts of war, the insurance against war perils will have to indemnify the loss. This must apply both where the destruction is an unintentional consequence of the acts of war, and where it is a result of military orders for the furtherance of military objectives of the State of registration or the State where the controlling ownership interests are located. In this connection, it makes no difference whether the military authorities have themselves effected the destruction, have ordered it, or have even used a formal requisition. In all of those cases, the assured’s loss will be recoverable. Only interventions by Norwegian authorities aimed at divesting the assured temporarily or definitively of his use of the object are irrecoverable. However, what the authorities are going to use the ship for is irrelevant.
Sub-clause 1 (b), third sentence, provides that if the ship is requisitioned for ownership or use by a State power, this is not regarded as an intervention in relation to Cl. 2-9, sub-clause 1 (b). The consequence of this is that, as a rule, such requisition will be covered neither under insurance against marine perils nor under insurance against war perils.
Sub-clause 1 (c) covers riots, sabotage, acts of terrorism and other social, religious or politically motivated use of violence or threat of the use of violence, strikes or lockouts.
By “riots” is meant violence in the form of unlawful actual harm to people or property, caused openly and by a large number of people. The distinction between riots and regular criminal acts, for which the marine-risk insurer is liable, must first and foremost be drawn on the basis of whether the background for the riots is political, social or similar circumstances.
By “sabotage” is primarily meant wilful destruction which does not form part of the conduct of war, but which is connected with, for example, labour conflicts. War sabotage is a war peril which will also be covered under sub-clause 1 (a). The sabotage need not be aimed at the actual object insured. A “go slow” action among dock workers or seamen is aimed at the employers’ interests in general, but if the action involves recoverable damage to the assured’s property, the war-risk insurer will be liable for the damage under sub-clause 1 (c). Destruction carried out by a ship’s crew as an act of vengeance or a protest demonstration against the owner must be regarded as vandalism of property and is covered by the insurance against marine perils. The same applies to wanton destruction of property carried out by someone of unsound mind or under the influence of alcohol. The term “sabotage” presupposes that the action pursues a specific political, social or similar goal, see ND 1990.140 NV PETER WESSEL, where the court based its decision on the assumption that the costs of interrupting the ship’s voyage etc. in connection with a bomb threat must be covered by the hull insurer against marine perils as costs of measures to avert or minimise the loss. The external circumstances of the threat clearly indicated that this was an act that had no background in political, social or similar circumstances.
The term "acts of terrorism" refers to the situation in which one or more representatives of a resistance group or the like carry out or threaten to carry out acts that are intended to exert influence on a government or another political body or to frighten all or parts of the population in a country.
The purpose is to promote a political, religious or ideological cause. The act of terrorism may directly affect an opponent's persons and/or interests, such as when bombs are placed in vehicles or on board ships, when aircraft are set on fire, when oil pipelines are cut, etc. However, there is nothing to prevent nor, moreover, is it uncommon for a terrorist act to be directed against a third party; in such case the purpose is usually to draw attention to the cause for which the terrorists are fighting.
Acts of terrorism are often characterised by the fact that they endanger the lives of many people, or cause extensive material damage. We have seen a number of examples of terrorist groups in recent years. An example is the terrorist attack against the United States of America on 11 September 2001.
As is the case for sabotage, acts of terrorism will under certain circumstances fall within the scope of the term "war or war-like conditions". This will primarily be the case when acts of terrorism occur in connection with a war between several States. One example may be acts committed by resistance groups in an occupied country with a view to hurting or weakening the enemy, for instance through acts of terrorism against ordinary merchant ships. "War-related terrorism" will therefore - like war-related sabotage - constitute a war peril that is covered by both sub-clause 1 (a) and (c). It is probably necessary to go one step further: acts of terrorism carried out in peacetime by resistance groups may also be so extensive that a "war-like condition" must be said to exist, see Brækhus/Rein, Håndbok i kaskoforsikring (Handbook of Hull Insurance), p. 78. However, whether the act in question is regarded as an act of terrorism or as part of the conduct of war or a war-like act has no significance in practice for the cover.
As in the case of "sabotage", however, it is necessary to maintain that an act of terrorism must have or purport to have its basis in a more comprehensive struggle of a political or social nature. Thus a distinction must be drawn between such acts and ordinary criminal acts, including blackmail, using bomb threats, etc., purely for the purpose of gain, cf. for instance ND 1990.140 NV PETER WESSEL.
The wording ”other social, religious or politically motivated use of violence or threat of the use of violence” include acts that bear clear similarities to sabotage and acts of terrorism in that they entail the use of violence or threat of the use of violence that is not for the purpose of personal gain. The criteria as regards to motivation are the same as those that apply to riots, sabotage and acts of terrorism and will normally involve several persons. However, the addition will also cover individuals who use violence for the aforementioned motives without this qualifying for description as sabotage.
“Strikes” occur where employees in one or more enterprises cease work according to a joint plan and with a joint motive.
“Lockout” entails that one or more employers shut the employees out from the work place, normally as part of an ongoing wage conflict.
Sub-clause 1 (d) covers piracy and mutiny. The text of the Plan is unchanged, but the Commentary to the term “piracy” was amended in the 2010 Version.
In earlier versions of the Plan, the term “piracy” was defined as illegal use of force by private individuals in open sea against a ship with crew, passengers and cargo. The wording “open sea” was the English translation of the Norwegian wording “det åpne hav”, which corresponds to the wording used in the Norwegian translation of the wording “high seas” in Article 101 of the United Nations Convention on the Law of the Sea, where piracy consists only of acts committed on the high seas, and not within the territorial limit of any coastal state. The provision must be seen in conjunction with Article 105, which allows States to prosecute this type of crime outside the States’ normal jurisdiction. It has therefore been asserted that the term “piracy” in the Plan only covers illegal use of force outside the jurisdiction of the coastal state, and in any event outside the territorial limit of 12 nautical miles. However, the wording “det åpne hav” or “open sea” (in the Norwegian text) was taken from the construction of the corresponding provision in the 1964 Plan in Brækhus/Rein: Håndbok i kaskoforsikring (Handbook of Hull Insurance), and in 1964 there were no corresponding clear international rules on the jurisdiction of coastal states. It was therefore uncertain whether the geographical delimitation should be linked to the issue of jurisdiction. However, there was also doubt as to how the term “det åpne hav” or “open sea” should be construed if it is not linked to international rules of jurisdiction. The state of the law on this point was therefore very uncertain.
In the current situation where piracy has again become a significant risk factor, it is unsatisfactory that there is an unclear geographical line between ordinary crime, which is a marine peril, and piracy, which is a war peril. The parties have pointed out that as a result of the increase in the illegal use of force, there is a need for war risk insurers to assume cover against this peril closer to land than the limit of the territorial waters or “the high seas”, as the case may be. The purpose of regulating piracy in the Law of the Sea Convention is, as mentioned above, to give States the possibility of prosecuting such crime outside their ordinary jurisdiction, and it is not necessarily the case that this delimitation is suitable for regulating piracy in the context of insurance law. The illegal use of force does not change in nature depending on whether the attack is outside or inside the economic zone or territorial limit. War risk insurers may change the trading area with immediate effect as the war peril changes, pursuant to the insurance conditions and according to practice, cf. Cl. 15-9. War risk insurers may also charge an additional premium as a condition for sailing in conditional trading areas. Marine risk insurers have neither a tradition nor the legal authority for making such changes.
The Committee therefore agreed that the geographical limitation linking piracy to “the high seas” is inappropriate, and that the term “piracy” in the Plan must be uncoupled from both the term “open sea” and the international legal definition in Article 101 of the Law of the Sea Convention.
This means that in relation to war risk insurance “piracy” may also take place within the territorial limit of a coastal state. How close to land the limit lies and which other delimitation criteria apply have been topics of discussion. The consideration of what it is natural to consider a war risk as opposed to “ordinary crime” which naturally belongs in the range of marine perils must be weighed against the consideration of establishing a simple, practicable limit. Moreover, when establishing a more specific delimitation, a distinction must be made between merchant vessels that derive their freight revenues from transporting goods and/or passengers from one port to another, and offshore installations that generate earnings by means of stationary operations in a field.
In the case of merchant ships, the Committee agrees that illegal use of force constitutes “piracy” as long as the ship is en route between two ports. Insofar as the ship is on its way from one port to another, therefore, it makes no difference whether the ship is inside or outside the territorial limit, or in “the high seas”. Under this approach, even illegal use of force on lakes with a waterway connection to a sea and rivers constitutes “piracy”. The Committee has discussed whether the limit for piracy should be drawn as far in as the ship’s anchorage in the port, but concluded that the limit must be drawn at the port limit. Therefore, the illegal use of force within the port limit is not “piracy”. This applies regardless of whether the ship is sailing in the port area or is anchored or moored, and regardless of whether the ship is lying at anchor at an ordinary anchorage for this port. The same applies to attacks while the ship is loading or discharging at a terminal. A key element in the concept of “piracy” in relation to merchant ships is that the use of force takes place at sea, making it difficult for the port State authorities to provide assistance. If the use of force takes place while the ship is within the port area, it is more natural to compare this with ordinary crime that is dealt with by the port State authorities.
The basic principle above is that the ship must be underway for an act to be piracy. However, there may be a need for war risk insurance even when the ship is temporarily anchored. Based on the considerations relating to the port limit above, the Committee has concluded that the illegal use of force against a ship that is temporarily anchored outside the port limit also constitutes piracy, even if the ship is anchored at an ordinary anchorage for the port in question. It is also piracy if the ship is attacked while it is at rest in the process of dynamic positioning or is loading from or discharging to a loading buoy outside the port area. When the ship is outside the port limit, it is more difficult for the port authorities to intervene in the event of an attack. Such an approach also concords with English law.
If the port limit has not been defined, the limit must be drawn on a discretionary basis depending on whether the use of force is in the nature of a civil peril risk or a war peril. On the one hand, the war risk insurance must obviously not cover anything that must be considered an ordinary crime of gain that is naturally dealt with by the port State authorities. On the other hand, it is important to cover the use of force by private individuals in an organised manner and the use of weapons that is more in the nature of a war peril. In countries with limited infrastructure where ports are poorly organised, there may, depending on the circumstances, be reason to let “piracy” cover attacks on ships that are temporarily anchored relatively close to land. The decisive factor must be that the way in which the use of force is organised and the use of weapons are in the nature of a war peril and not that of ordinary crime that can be dealt with by the port State authorities.
The shipowners have pointed out that the criterion “underway” is not suitable either for offshore units, dynamically positioned ships and other types of ship designed for stationary operation in a field, and which therefore are not “underway”. Consequently, in the case of such units, the Committee has decided that “piracy” is to include illegal attacks on the unit while it is operating in the field, regardless of whether the field is located in “open sea” or the high seas. This kind of situation is in the nature of a war risk in the sense that the use of force necessitates a certain amount of organisation, in addition to which it takes place at some distance from land and the control of the authorities. Since the Committee has now decided that the illegal use of force against merchant ships will constitute piracy all the way to the port limit, it makes no difference how far from land the unit is operating. Since it has been decided that “the high seas” is no longer to apply as a criterion, piracy may also comprise e.g. the illegal use of force in a river delta.
The rule that attacks on units while they are laid up or under repair at or near a shipyard are to be regarded as a marine peril also applies to offshore units. Ordinarily, offshore units will not lie at or near a shipyard in the same way as a merchant ship. If the unit has been taken out of operation and moved from the field in order to make repairs, the stay at the place where the repairs are made must be regarded as a repair period. Attacks while the unit is being moved from the field to or from the place in which it is to be laid up or repaired shall be covered by the war risk insurance provided the moving process takes place outside the port limit.
The use of force may take place by means of another ship, but the pirates may also have come aboard as members of the crew or passengers on the ship which they subsequently plunder. The purpose will normally be economic profit, but an action that merely results in property damage or personal injury may also constitute piracy. Piracy will often be organized by people who purport to exercise government authority (e.g., an exile government that captures vessels to call global attention to their cause or in order to finance their revolt). The practical difficulties that would arise if a distinction had to be made between “piracy” and “measures by a foreign State power” are avoided by piracy being covered by the war-risks insurance, cf. sub-clause 1 (b).
“Mutiny” means insurrection by the crew against the officers, cf. Section 312 of the Norwegian Penal Code. This alternative will hardly be of any major practical significance. It has been placed within the range of war risks inter alia because it may be difficult to distinguish between mutiny and piracy, typically where bandits who have signed on as ordinary crew members incite mutiny.
Sub-clause 1 (e) corresponds in its entirety to Cl. 2-8 (b), third sentence.
Sub-clause 2 (a) is identical to Cl. 2-8 (c) and reference is made to the comments above.
The exceptions in Cl. 2-9, sub-clause 2 (b), are identical to the exceptions in Cl. 2-8 (d), except for cover of the use of radioactive isotopes for peaceful purposes, which is not relevant in a war-risks insurance. Reference is otherwise made to the Commentary on Cl. 2-8 (d) (1)–(5).