The Plan

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Section 3: Liability of the assured to third parties

  • Clause 4-13. Main rule

    The insurer is not liable for the assured's liability to third parties, unless otherwise provided in this Plan or specially agreed.

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    Clause 4-13. Main rule

    This Clause is identical to Cl. 74 of the 1964 Plan.

  • Clause 4-14. Cross liabilities

    If the assured has incurred liability, and he is entitled to make a claim against the injured party for a loss which he himself has suffered on the same occasion, the settlement of the claim between the assured and the insurer shall be based on the calculated gross liabilities before any set-off is effected. This applies even if one or both of the liabilities are limited in the settlement between the assured and the injured party. If the limitation is applied to the balance between the liabilities of the assured and the injured party, the largest calculated gross liability shall in the settlement of the claim between the assured and the insurer be reduced by the same amount by which the balance has been reduced.

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    Clause 4-14. Cross liabilities

    This Clause is identical to Cl. 75 of the 1964 Plan. Under Cl. 4-14, first sentence , the Plan maintains the principle of cross-liabilities in connection with liability of the assured to third parties. The principle is in accordance with established customary Norwegian marine insurance law, cf....

  • Clause 4-15. Unusual or prohibited terms of contract

    The insurer is in no case liable for liability incurred because the assured or someone on his behalf:

    • has entered into a contract that results in stricter liability than that which follows from the ordinary rules of maritime law, unless such terms must be considered customary in the trade concerned,
    • has used or failed to use terms of contract which the insurer in accordance with Cl. 3-28 has prohibited or prescribed.
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    Clause 4-15. Unusual or prohibited terms of contract

    This Clause is identical to Cl. 76 of the 1964 Plan. The collision liability covered by the hull insurer will normally have been incurred vis-à-vis a third party with whom the assured does not have any contractual relationship. However, it is conceivable that the assured’s contracts may be of...

  • Clause 4-16. Objects belonging to the assured

    The insurer is liable for loss sustained by the assured when an object belonging to the assured is damaged or lost under such circumstances that the assured himself would have become liable for the loss if the object had belonged to a third party and the insurer would have had to indemnify the assured for such liability. This does not, however, apply to loss of or damage to the insured ship, its supplies and equipment.

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    Clause 4-16. Objects belonging to the assured

    This Clause is identical to Cl. 77 of the 1964 Plan. If two of the assured’s ships collide, the ships’ hull insurers will cover the damage they have sustained. If the ships had belonged to different legal entities, the ship that was at fault would have also had to cover the other ship’s loss of...

  • Clause 4-17. Determination of the liability of the assured

    If the insurance covers the assured's liability to third parties, an injured third party does not have any direct claim against the insurer.

    The insurer will indemnify the assured's loss as a result of liability if it has been established by:

    • a final and unappealable judgment or order by a competent court,
    • an arbitration award, if an agreement for a decision by arbitration had been entered into before the dispute arose or was entered into later with the insurer's consent,
    • an amicable settlement approved by the insurer.


    If the assured has in other cases accepted or settled a claim, the insurer shall only cover the loss if the assured proves that the claim was justified and the amount of any settlement was reasonable.

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    Clause 4-17. Determination of the liability of the assured

    This Clause corresponds to relevant Nordic Insurance Contracts Acts (Nordic ICAs). Cl. 4-17 was amended in the 2013 Plan in order to better safe guard against non-Nordic courts allowing a direct action against the insurer. The Nordic ICAs contain a provision which gives an injured third party a...