Commentary
-
Part One: Rules common to all types of insurance
- Chapter 1: Introductory provisions
-
Chapter 2: General rules relating to the scope of the insurance
-
Section 1: Insurable interest and insurable value
- General
- Clause 2-1. Insurance unrelated to any interest
- Clause 2-2. Insurable value
- Clause 2-3. Agreed insurable value
- Clause 2-4. Under-insurance
- Clause 2-5. Over-insurance
- Clause 2-6. Liability of the insurer when the interest is also insured with another insurer
- Clause 2-7. Recourse between the insurers where the interest is insured with two or more insurers
-
Section 2: Perils insured against, causation and loss
- General
- Clause 2-8. Perils covered by an insurance against marine perils
- Clause 2-9. Perils covered by an insurance against war perils
- Clause 2-10. Perils insured against when no agreement has been made as to what perils are covered by the insurance
- Clause 2-11. Causation. Incidence of loss
- Clause 2-12. Main rule relating to the burden of proof
- Clause 2-13. Combination of perils
- Clause 2-14. Combination of marine and war perils
- Clause 2-15. Losses deemed to be caused entirely by war perils
- Clause 2-16. Loss attributable either to marine or war perils
- Clause 2-17. Sanction limitation and exclusion
-
Section 1: Insurable interest and insurable value
-
Chapter 3: Duties of the person effecting the insurance and of the assured
- General remarks
-
Section 1: Duty of disclosure of the person effecting the insurance
- Clause 3-1. Scope of the duty of disclosure
- Clause 3-2. Fraudulent misrepresentation
- Clause 3-3. Other failure to fulfil the duty of disclosure
- Clause 3-4. Innocent breach of the duty of disclosure
- Clause 3-5. Cases where the insurer may not invoke breach of the duty of disclosure
- Clause 3-6. Duty of the insurer to give notice
- Clause 3-7. Right of the insurer to obtain particulars from the vessel's classification society, etc.
-
Section 2: Alteration of the risk
- Clause 3-8. Alteration of the risk
- Clause 3-9. Alteration of the risk caused or agreed to by the assured
- Clause 3-10. Right of the insurer to cancel the insurance
- Clause 3-11. Duty of the assured to give notice
- Clause 3-12. Cases where the insurer may not invoke alteration of the risk
- Clause 3-13. Duty of the insurer to give notice
- Clause 3-14. Loss of the main class
- Clause 3-15. Trading areas
- Clause 3-16. Illegal undertakings
- Clause 3-17. Suspension of insurance in the event of requisition
- Clause 3-18. Notification of requisition
- Clause 3-19. Suspension of insurance while the vessel is temporarily seized
- Clause 3-20. Removal of the vessel to a repair yard
- Clause 3-21. Change of ownership
- Section 3: Safety regulations
- Section 4: Measures to avert or minimise loss, etc.
- Section 5: Casualties caused intentionally or negligently by the assured
- Section 6. Identification
-
Chapter 4: Liability of the insurer
- General
- Section 1: General rules relating to the liability of the insurer
-
Section 2: Costs of measures to avert or minimise the loss, including salvage awards and general average
- General
- Clause 4-7. Compensation of the costs of measures to avert or minimise loss
- Clause 4-8. General average
- Clause 4-9. General average apportionment where the interests belong to the same person
- Clause 4-10. Damage to and loss of the object insured
- Clause 4-11. Assumed general average
- Clause 4-12. Costs of particular measures taken to avert or minimise loss
- Section 3: Liability of the assured to third parties
- Section 4: The sum insured as the limit of the liability of the insurer
-
Chapter 5: Settlement of claims
-
Section 1: Claims adjustment, interest, payments on account, etc.
- Clause 5-1. Duty of the assured to provide information and documents
- Clause 5-2. Claims adjustment
- Clause 5-3. Rates of exchange
- Clause 5-4. Interest on the compensation
- Clause 5-5. Disputes concerning the adjustment of the claim
- Clause 5-6. Due date
- Clause 5-7. Duty of the insurer to make a payment on account
- Clause 5-8. Payment on account when there is a dispute as to which insurer is liable for the loss
- Section 2: Liability of the assured to third parties
-
Section 3: Claims by the assured for damages against third parties
- Clause 5-13. Right of subrogation of the insurer to claims by the assured for damages against third parties
- Clause 5-14. Waiver of claim for damages
- Clause 5-15. Duty of the assured to assist the insurer with information and documents
- Clause 5-16. Duty of the assured to maintain and safeguard the claim
- Clause 5-17. Decisions concerning legal proceedings or appeals
- Clause 5-18. Salvage award which entails compensation for loss covered by the insurer
- Section 4: Right of the insurer to take over the object insured upon payment of a claim
- Section 5: Limitation, etc.
-
Section 1: Claims adjustment, interest, payments on account, etc.
-
Chapter 6: Premium
- General
- Clause 6-1. Payment of premium
- Clause 6-2. Right of the insurer to cancel the insurance in the event of non-payment of premium
- Clause 6-3. Premium in the event of total loss
- Clause 6-4. Additional premium when the insurance is extended
- Clause 6-5. Reduction of premium
- Clause 6-6. Reduction of premium when the vessel is laid up or in similar situations
- Clause 6-7. Claim for a reduction of premium
- Chapter 7: Co-insurance of mortgagees
-
Chapter 8: Co-insurance of third parties
- General
- Clause 8-1. Rights of third parties against the insurer
- Clause 8-2. Protection of third parties against subrogation claims from the insurer
- Clause 8-3. Application of the rules in Chapter 3 and Clause 5-1
- Clause 8-4. Amendments and cancellation of the insurance contract
- Clause 8-5. Handling of claims, claims adjustment, etc.
- Clause 8-6. Other insurance
- Clause 8-7. Independent co-insurance of mortgagees or named third parties
-
Chapter 9: Relations between the claims leader and co-insurers
- General
- Clause 9-1. Definitions
- Clause 9-2. The right of the claims leader to act on behalf of the co-insurers
- Clause 9-3. Lay-up plan
- Clause 9-4. Notification of a casualty
- Clause 9-5. Salvage
- Clause 9-6. Removal and repairs
- Clause 9-7. Provision of security
- Clause 9-8. Disputes with third parties
- Clause 9-9. Claims adjustment
- Clause 9-10. Insolvency of a co-insurer
- Clause 9-11. Interest on the disbursements of the claims leader
-
Part Two: Hull insurance
-
Chapter 10: General rules relating to the scope of the hull insurance
- Clause 10-1. Objects insured
- Clause 10-2. Objects, etc. temporarily removed from the vessel
- Clause 10-3. Loss due to ordinary use
- Clause 10-4. Insurance "on full conditions"
- Clause 10-5. Insurance “against total loss only” (T.L.O.)
- Clause 10-6. Insurance “against total loss and general average contribution only”
- Clause 10-7. Insurance “against total loss, general average contribution and collision liability only”
- Clause 10-8. Insurance "on stranding terms"
- Clause 10-9. Duration of voyage insurance
- Clause 10-10. Extension of the insurance
- Clause 10-11. Liability of the insurer if the vessel is salvaged by the assured
- Clause 10-12. Reduction of liability in consequence of an interest insurance
-
Chapter 11: Total loss
- Clause 11-1. Total loss
- Clause 11-2. Salvage attempts
- Clause 11-3. Condemnation
- Clause 11-4. Condemnation in the event of a combination of perils
- Clause 11-5. Request for condemnation
- Clause 11-6. Removal of the vessel
- Clause 11-7. Missing or abandoned vessel
- Clause 11-8. Extension of the insurance when the vessel is missing or abandoned
- Clause 11-9. Liability of the insurer during the period of clarification
-
Chapter 12: Damage
- General
- Clause 12-1. Main rule concerning liability of the insurer
- Clause 12-2. Compensation for unrepaired damage
- Clause 12-3. Inadequate maintenance, etc.
- Clause 12-4. Error in design, etc.
- Clause 12-5. Losses that are not recoverable
- Clause 12-6. Deferred repairs
- Clause 12-7. Temporary repairs
- Clause 12-8. Costs incurred in expediting repairs
- Clause 12-9. Repairs of a vessel that is condemnable
- Clause 12-10. Survey of damage
- Clause 12-11. Invitations to tender
- Clause 12-12. Choice of repair yard
- Clause 12-13. Removal of the vessel
- Clause 12-14. Apportionment of common expenses
- Clause 12-15. Ice damage deductions
- Clause 12-16. Machinery damage deductions
- Clause 12-17. Compensation without deductions
- Clause 12-18. Deductible
- Clause 12-19. Basis for calculation of deductions according to Clauses 12-15 to 12-18 and Clause 3-15
- Chapter 13: Liability of the assured arising from collision or striking
-
Chapter 10: General rules relating to the scope of the hull insurance
-
Part Three: Other insurances for ocean-going vessels
-
Chapter 14: Separate insurances against total loss
- General
- Clause 14-1. Insurance against total loss and excess collision liability (hull interest insurance)
- Clause 14-2. Insurance against loss of long-term freight income (freight interest insurance)
- Clause 14-3. Common rules for separate insurances against total loss
- Clause 14-4. Limitations on the right to effect separate insurances against total loss
- Chapter 15: War risks insurance
-
Chapter 16: Loss of hire insurance
- General
- Clause 16-1. Main rules regarding the liability of the insurer
- Clause 16-2. Total loss
- Clause 16-3. Main rule for calculating compensation
- Clause 16-4. Calculation of the loss of time
- Clause 16-5. The daily amount
- Clause 16-6. Agreed daily amount
- Clause 16-7. Deductible period
- Clause 16-8. Survey of damage
- Clause 16-9. Choice of repair yard
- Clause 16-10. Removal to the repair yard, etc.
- Clause 16-11. Extra costs incurred in order to avert or minimise loss
- Clause 16-12. Simultaneous repairs
- Clause 16-13. Loss of time after completion of repairs
- Clause 16-14. Repairs carried out after expiry of the insurance period
- Clause 16-15. Liability of the insurer when the vessel is transferred to a new owner
- Clause 16-16. Relationship to other insurances and general average
-
Chapter 14: Separate insurances against total loss
-
Part Four: Other insurances
-
Chapter 17: Insurance for fishing vessels
- General
-
Section 1: General provisions
- Clause 17-1. Scope of application
- Clause 17-2. Renewal of the insurance/Ref. Clause 1-5
- Clause 17-3. Trading areas for fishing vessels/Ref. Clause 3-15
- Clause 17-4. Classification and vessel inspection/Ref. Clause 3-14 and Clause 3-8
- Clause 17-5. Safety regulations/Ref. Clause 3-22 and Clause 3-25
- Clause 17-6. Savings to the assured
-
Section 2: Hull insurance
- General
- Clause 17-7. The relationship to Chapters 10-13
- Clause 17-7A. Fixed equipment temporarily removed from the vessel
- Clause 17-8. Change of the open or agreed insurable value/Ref. Clause 2-2 and Clause 2-3
- Clause 17-9. Damage to lifeboats, fishing, whaling and sealing tackle and catch/Ref. Clause 4-7 to Clause 4-12 and Clause 4-16
- Clause 17-10. Hull and freight-interest insurance/Ref. Clause 10-12
- Clause 17-11. Condemnation/Ref. Clause 11-3
- Clause 17-12. Damage to the hull of vessels which are not built of steel/Ref. Clause 12-1
- Clause 17-13. Limited cover of damage to machinery
- Clause 17-14. Costs incurred in saving time/Ref. Clause 12-7, Clause 12-8, Clause 12-11 and Clause 12-12
- Clause 17-15. Deductions/Ref. Clause 12-15, Clause 12-16 and Clause 12-18
- Clause 17-16. Collision liability for fishing vessels/Ref. Clause 13-1
- Clause 17-17. Collision liability/Ref. Clause 13-1
- Section 3: Hull insurance - extended cover
-
Section 4: Catch and equipment insurance - standard cover
- General
- Clause 17-19. Objects insured
- Clause 17-20. Insurable value
- Clause 17-21. Extraordinary handling costs
- Clause 17-22. Excluded perils/Ref. Clause 2-8
- Clause 17-23. Deck cargo
- Clause 17-24. Total loss
- Clause 17-25. Damage to or loss of catch
- Clause 17-26. Damage to other objects
- Clause 17-27. Survey of damage
- Clause 17-28. Deductible
- Section 5: Supplementary cover for nets and seines in the sea
-
Section 6: Loss of hire insurance for fishing vessels
- General comments
- Clause 17-33. Relationship to Chapter 16
- Clause 17-34. Liability of the insurer/applies instead of Clause 16-1
- Clause 17-35. Total loss/applies instead of Clause 16-2
- Clause 17-36. Calculation of compensation for fishing vessels/Ref. Clause 16-3
- Clause 17-37. The daily amount for fishing vessels/applies instead of Clause 16-5
- Clause 17-38. Agreed daily amount for fishing vessels/applies instead of Clause 16-6
-
Chapter 18: Insurance of mobile offshore units (MOUs)
- Overview
- Section 1: General rules relating to the scope of the insurance
-
Section 2: Hull insurance
-
Section 2-1: General rules relating to the scope of the H&M insurance
- Clause 18-2. Objects insured
- Clause 18-3. Objects temporarily removed or separated etc. from the MOU
- Clause 18-4. Loss due to ordinary use
- Clause 18-5. Extension of the insurance
- Clause 18-6. Liability of the insurer if the MOU is salvaged by the assured
- Clause 18-7. Reduction of liability in consequence of an interest insurance
-
Section 2-2: Total loss
- Clause 18-8. Total loss
- Clause 18-9. Salvage attempts
- Clause 18-10. Condemnation
- Clause 18-11. Condemnation in the event of a combination of perils
- Clause 18-12. Request for condemnation
- Clause 18-13. Removal of the MOU
- Clause 18-14. Missing or abandoned MOU
- Clause 18-15. Extension of the insurance when the MOU is missing or abandoned
- Clause 18-16. Liability of the insurer during the period of clarification
-
Section 2-3: Damage
- General
- Clause 18-17. Main rule concerning liability of the insurer
- Clause 18-18. Compensation for unrepaired damage
- Clause 18-19. Inadequate maintenance
- Clause 18-20. Error in design, etc.
- Clause 18-21. Losses that are not recoverable
- Clause 18-22. Damage to the drill string
- Clause 18-23. Deferred repairs
- Clause 18-24. Temporary repairs
- Clause 18-25. Costs incurred in expediting repairs
- Clause 18-26. Repairs of an MOU that is condemnable
- Clause 18-27. Survey of damage
- Clause 18-28. Invitations to tender
- Clause 18-29. Choice of repairers
- Clause 18-30. Removal for repairs
- Clause 18-31. Apportionment of common expenses
- Clause 18-32. Ice damage deductions
- Clause 18-33. Deductible
- Clause 18-34. Basis for calculation of deductions according to Clauses 18-32, 18-33 and 3-15
- Section 2-4: Liability of the assured arising from collision or striking
-
Section 2-1: General rules relating to the scope of the H&M insurance
-
Section 3: Separate insurances against total loss
- Clause 18-39. Insurance against total loss and excess collision liability (hull interest insurance)
- Clause 18-40. Insurance against loss of long-term freight income (freight interest insurance)
- Clause 18-41. Common rules for separate insurances against total loss
- Clause 18-42. Limitations on the right to insure separately against total loss
-
Section 4: Loss of hire insurance
- Clause 18-43. Main rules regarding the liability of the insurer
- Clause 18-44. Total loss
- Clause 18-45. Main rule for calculating compensation
- Clause 18-46. Calculation of the loss of time
- Clause 18-47. The daily amount
- Clause 18-48. Agreed daily amount
- Clause 18-49. Deductible period
- Clause 18-50. Survey of damage
- Clause 18-51. Choice of repairer
- Clause 18-52. Move to the repair location, etc.
- Clause 18-53. Extra costs incurred in order to avert or minimise loss
- Clause 18-54. Simultaneous works
- Clause 18-55. Loss of time after completion of repairs
- Clause 18-56. Repairs carried out after expiry of the insurance period
- Clause 18-57. Liability of the insurer when the MOU is transferred to a new owner
- Clause 18-58. Relationship to other insurances and general average
-
Section 5: War risks insurance
- Section 5-1: General rules relating to the scope of war risks insurance
- Section 5-2: Termination of the insurance
- Section 5-3: Areas of operation
- Section 5-4: Total loss
- Section 5-5: Damage
- Section 5-6: Loss of hire
- Section 5-7: Owner’s liability, etc. (P&I)
- Section 5-8: Occupational injury insurance, etc.
-
Section 6: Construction risks insurance
- Section 6-1: General rules relating to the scope of construction risks insurance
-
Section 6-2: Loss of or damage to the MOU
- Clause 18-87. Objects insured/Ref Clause 18-2
- Clause 18-88. Insurable value
- Clause 18-89. Compensation in the event of a total loss/Ref. Clause 4-1
- Clause 18-90. Total Loss/Ref. Section 2-2
- Clause 18-91. Damage/Ref. Section 2-3
- Clause 18-92. Error in design, etc.
- Clause 18-93. Costs incurred in order to save time/Ref. Clauses 18-24, 18-28 and 18-29
- Section 6-3: Supplementary covers
-
Chapter 19: Builders’ risks insurance
- General
-
Section 1: Common provisions
- Clause 19-1. Perils covered/Ref. Clause 2-8, cf. Clause 2-10
- Clause 19-2. Insurance period/Ref. Clause 1-5
- Clause 19-2A. Premium in the event of total loss
- Clause 19-3. Co-insurance/Ref. Clause 8-1
- Clause 19-4. Transfer of the building contract/Ref. Clause 3-21
- Clause 19-5. Place of insurance
- Clause 19-6. The sum insured as the limit of the liability of the insurer/Ref. Clause 4-18 and Clause 4-19
- Clause 19-7. Escalation of the sum insured
- Clause 19-8. Deductible
-
Section 2: Loss of or damage to the subject-matter insured
- Clause 19-9. Objects insured/Ref. Clause 10-1
- Clause 19-10. Insurable value
- Clause 19-11. Total loss in the event of condemnation
- Clause 19-12. Total loss where the yard’s obligation to deliver no longer applies
- Clause 19-13. Compensation in the event of a total loss/Ref. Clause 4-1
- Clause 19-14. Damage/Ref. Chapter 12
- Clause 19-15. Limitation of the insurer’s liability/Ref. Clause 12-1
- Clause 19-16. Compensation for unrepaired damage/Ref. Clause 12-2
- Clause 19-17. Costs incurred in order to save time/Ref. Clause 12-7, Clause 12-11 and Clause 12-12
- Section 3: Indemnification of additional costs incurred in an unsuccessful launching and costs of wreck removal
- Section 4: Liability insurance
-
Section 5: Supplementary covers
- Clause 19-22. Applicable rules
- Clause 19-23. Insurance of additional costs in connection with rebuilding and/or building of a new subject-matter insured
- Clause 19-24. Insurance of the yard’s liability for the buyer’s interest claim for instalments paid
- Clause 19-25. Insurance of the yard’s loss of interest in the event of late delivery
- Clause 19-26. Insurance of the yard’s daily penalties in the event of late delivery
- Clause 19-27. Towage and removal of the subject-matter insured
- Section 6: Supplementary cover for war risks
-
Chapter 20: Insurance for vessels with trading certificates
- General
- Section 1: Common provisions
-
Section 2: Hull insurance
- General
- Clause 20-6. The relationship to Chapters 10-13
- Clause 20-7. Hull and freight-interest insurance/Ref. Clause 10-12
- Clause 20-8. Condemnation/Ref. Clause 11-3
- Clause 20-9. Damage to the hull of vessels which are not built of steel/Ref. Clause 12-1
- Clause 20-10. Limited cover of damage to machinery
- Clause 20-11. Costs incurred in saving time/Ref. Clause 12-7, Clause 12-8, Clause 12-11 and Clause 12-12
- Clause 20-12. Deductions/Ref. Clause 12-15, Clause 12-16 and Clause 12-18
- Clause 20-13. Collision liability/Ref. Clause 13-1
- Section 3: Hull insurance - extended cover
- Section 4: Hull insurance - limited cover
-
Chapter 21: Liability insurance
- Clause 21-1. Scope of application
- Clause 21-2. Renewal of the insurance/Ref. Clause 1-5
- Clause 21-3. Classification and vessel inspection/Ref. Clause 3-14 and Clause 3-8
- Clause 21-4. Savings to the assured
- Clause 21-5. Perils covered
- Clause 21-6. Liability for personal injury
- Clause 21-7. Liability for property damage
- Clause 21-8. Liability for description
- Clause 21-9. Liability for the misdelivery of goods
- Clause 21-10. General average contributions
- Clause 21-11. Liability for removal of wrecks
- Clause 21-12. Liability for special salvage compensation
- Clause 21-13. Liability for bunker oil pollution damage and damage to the environment
- Clause 21-14. Stowaways
- Clause 21-15. Liability for fines, etc.
- Clause 21-16. Liability for social benefits for the crew
- Clause 21-17. Travel expenses for replacement crew
- Clause 21-18. Expenses for disinfection and quarantine
- Clause 21-19. Limitation due to other insurance, etc.
- Clause 21-20. Safety regulations/Ref. Clause 3-22 and Clause 3-25
- Clause 21-21. Assured's fault
- Clause 21-22. The insurer's rights in the event of liability
- Clause 21-23. Liability for loss that occurred during other transport, etc.
- Clause 21-24. Limitation of liability for fishing vessels
- Clause 21-25. Limitation of the insurer's liability for measures to avert or minimise loss
- Clause 21-26. The sum insured as a limit to the insurer's liability
- Clause 21-27. Deductible
-
Chapter 17: Insurance for fishing vessels
- Pdf download
Section 2: Hull insurance
-
General
Section 2 deals with the standard cover of hull insurance for fishing vessels. The provisions in Section 2 are supplementary to Part II of the Plan, Chapters 10 to 13, relating to hull insurance. This was previously stated in the Commentary, but has now also been included in the text of the Plan, cf. Cl. 17-7.
In addition to the provisions in Section 2, this insurance is therefore subject to the common provisions in Section 1 and the provisions in the general part I of the Plan (Chapters 1 to 9) and part II relating to hull insurance (Chapters 10 to 13).
The system of a standard cover for fishing vessels and an extended cover for fishing vessels has been retained in that the standard cover is incorporated in Section 2, while the extended cover is incorporated in Section 3.
In accordance with the general system of the Plan, the most practical approach is for deductibles and machinery damage deductions to be agreed on an individual basis. Hence, it is sufficient here to apply the rules in Cl. 12-16 and Cl. 12-18. There was also agreement that the new for old deductions were cumbersome and outdated, and that they should therefore be deleted and replaced by machinery damage deductions and deductibles which took into account the age of the vessel and machinery and the sum insured. However, insurance without new for old deductions is conditional on these deductions being compensated for by the other deductions. If the assured is not willing to accept a sufficiently high level of deductible and machinery damage deductions, the insurers must therefore be entitled to incorporate provisions concerning new for old deductions in the individual insurance contract.
-
Clause 17-7. The relationship to Chapters 10-13
View Clause Go to Plan pageThe provision states that for hull insurance the rules of Chapters 10 to 13 apply, with such amendments as follow from Cl. 17-7A and Cl. 17-10 to Cl. 17-17 inclusive. Certain amendments in the general rules of the Plan, see Cl. 17-8 and Cl. 17-9, also apply. The reference to Cl. 17-7A is new in the 2013 Plan.
-
Clause 17-7A. Fixed equipment temporarily removed from the vessel
View Clause Go to Plan pageThis Clause was new in the 2013 Plan. The two sub-clauses used to be found in Cl. 10-2 sub-clause 2 and 3.
It is an absolute prerequisite for this extended cover that the object has been on board before it was stored ashore. This extension of the insurance applies only to the explicitly stated objects, viz. fixed equipment for fishing vessels. In Version 2023, the requirement to notify the insurer before leaving port was deleted as it was not considered relevant. Lastly, the only risks this cover of objects removed from the vessel comprises, is fire and burglary through forced entry into a locked storage building or room.
The term “burglary” is identical to "burglary" as defined in Section 9 of the English Theft Act 1968: “A person is guilty of burglary if
- he enters any building or part of a building as a trespasser and with intent to commit any such offence as is mentioned in subsection (2) below; or
- having entered into any building or part of a building as a trespasser he steals or attempts to steal anything in the building or that part of it or inflicts or attempts to inflict on any person therein any grievous bodily harm."
The cover also has a special safety regulation obliging the assured to store the equipment in a locked storage building or room.
Sub-clause 2 establishes that in the event of a total loss of the vessel, a deduction shall be made from the total-loss compensation for the value of the stored equipment.
Clause 17-7A. Fixed equipment temporarily removed from the vessel
Where fixed equipment for fishing vessels is temporarily taken ashore, it shall be stored in a locked storage building or room. The insurer is liable for loss resulting from fire and burglary through forced entry into a locked storage building or room. In the event of a total loss of the vessel,...
-
Clause 17-8. Change of the open or agreed insurable value/Ref. Clause 2-2 and Clause 2-3
View Clause Go to Plan pageAccording to the rules of the Plan, the parties may choose between open and agreed insurable value, cf. Cl. 2-2 and Cl. 2-3. An open insurable value is fixed at the “full value of the interest at the inception of the insurance”, cf. Cl. 2-2. However, an agreed insurable value is fixed by agreement between the parties when the insurance is effected, cf. Cl. 2-3. According to Cl. 2-3, such an agreed insurable value is binding unless the assured has given misleading information about matters that are relevant for the agreement. There are, however, possibilities of demanding a revision of the agreed insurable value in the event of market fluctuations, cf. Cl. 2-3, sub-clause 2.
A common denominator for open and agreed insurable value is thus the fact that in principle there is no basis for taking into account any changes in value after the contract is entered into (unless the right to a revision in Cl. 2-3, sub-clause 2, becomes applicable). However, the value of a fishing vessel is largely contingent on the vessel’s fishing rights, and it is therefore necessary to have a provision that entitles the insurer to take account of changes in such rights. The first sentence imposes a duty of notification on the assured in two situations. The first situation was defined in earlier versions of the Plan as changes in concession conditions. This wording has been amended to “conditions prescribed by public authorities relating to the vessel’s fishing rights”. This amendment was necessitated by changes in fisheries insurance contract, such as the introduction of perpetual fishing rights. Fishing rights now go by a variety of names, such as concessions, structural arrangements, unit quota systems, participation rights, etc., depending on the type of fishing the vessel is engaged in and the size of the vessel. The wording “concession conditions” is therefore no longer adequate to cover changes of relevance to the insurer.
Such changes may have a direct impact on the value of a fishing vessel and create the need for a renegotiation of the agreed insurable value. Similarly, there will in connection with the determination of an open insurable value be a need to take such factors into consideration. In the second situation, the assured shall notify the insurer if he has accepted an offer of a state destruction subsidy which is lower than the agreed insurable value. The state will often offer a subsidy to break up the vessel in order to reduce the fishing fleet. Because it may take some time from when the offer is accepted until the vessel is taken out of service, the assured will need insurance in the interim period. If the assured has accepted an offer for such a subsidy which is lower than the agreed insurable value, it is natural that the insurer is given a right to renegotiate the agreed insurable value. Similarly, it should be possible to take this fact into account in connection with a subsequent calculation of an open insurable value.
The second sentence provides the insurer with a right to demand a reduction of the open or agreed insurable value in cases such as mentioned in the first sentence. This provision thus gives the insurer a possibility of renegotiating the agreed insurable value during the insurance period. If the assured has failed to give the necessary notices, the insurer must nevertheless have the right to set aside the agreed insurable value in a subsequent settlement.
It follows from Cl. 2-4 that the question of under-insurance must be based on the agreed insurable value, even if it is set aside under sub-clause 1. The rule entails that if the agreed insurable value is 5, the real value 2.5, and the sum insured 4, the insurer will be liable for 4/5 of 2.5, i.e. 2.
If the assured has accepted an offer for a state subsidy to break up the vessel, and the vessel is damaged before being broken up, the insurer will be liable in the normal way. In the event of a total loss, the insurer will be liable for total-loss compensation. Such compensation will be deducted from the state subsidy. The same applies if the vessel at the time of condemnation has an unrepaired damage for which the insurer is liable. Damage which has already been repaired and indemnified will, however, not have any influence on the condemnation settlement.
If the parties disagree as to whether there is any reason to reduce the agreed insurable value, or about the size of the reduction, the provisions in Cl. 2-3, sub-clause 3, shall apply. The question will then be decided with final effect by a Nordic average adjuster designated by the assured. The provision shall be applied by analogy if the parties disagree about the significance of the said matters for a subsequent calculation of an open insurable value.
When the parties renegotiate the agreed insurable value, they must also negotiate the possibility of a reduction in premium.
Clause 17-8. Change of the open or agreed insurable value/Ref. Clause 2-2 and Clause 2-3
In addition to Cl. 2-2 and Cl. 2-3 the following shall apply: The assured shall notify the insurer of any changes in conditions prescribed by public authorities relating to the vessel's fishing rights, or if the assured accepts an offer for a public destruction subsidy which is lower than the op...
-
Clause 17-9. Damage to lifeboats, fishing, whaling and sealing tackle and catch/Ref. Clause 4-7 to Clause 4-12 and Clause 4-16
View Clause Go to Plan pageThe dories, fishing gear and catch have in principle been lifted out of the hull insurance through the exception in Cl. 10-1, sub-clause 2. The insurer is nevertheless in principle liable for damage to such objects if the damage occurs during a measure to avert or minimise loss. Damage to or loss of such objects should, however, be covered by the owner himself on the basis of a “knock-for-knock” line of thought. Where several fishing vessels are operating together, it is foreseeable that equipment will be damaged in various connections. Instead of involving the owner’s own insurance company or that of the party causing the damage in an often-difficult insurance settlement with complicated evidentiary problems, it is therefore more expedient to let the owner bear his own damage.
The provision in Cl. 17-9 therefore explicitly excludes such damage from the cover in cases where it is connected with a measure to avert or minimise loss only applies to fishing vessels and not to freighters.
Clause 17-9. Damage to lifeboats, fishing, whaling and sealing tackle and catch/Ref. Clause 4-7 to Clause 4-12 and Clause 4-16
The insurer's liability for costs of measures to avert or minimise loss, cf. Cl. 4-7 to Cl. 4-12, does not cover loss of or damage to the fishing vessel's lifeboats, fishing, whaling and sealing tackle or catch which occurs while these objects are outside the vessel.
-
Clause 17-10. Hull and freight-interest insurance/Ref. Clause 10-12
View Clause Go to Plan pageToday separate total-loss insurances for fishing vessels and freighters are not normally offered. However, the owners wish to have such an offer. It has therefore been stated explicitly that the hull insurer may consent to the effecting of interest insurance. In that event, the reduction rule will only apply to interest insurances which are larger than what the hull insurer has consented to.
Clause 17-10. Hull and freight-interest insurance/Ref. Clause 10-12
Instead of Cl. 10-12 the following shall apply: If the insured receives compensation under an interest insurance, the hull insurer's liability is reduced correspondingly, unless the hull insurer has consented in advance to such insurance being taken out.
-
Clause 17-11. Condemnation/Ref. Clause 11-3
View Clause Go to Plan pageThe condemnation limit is 90% in relation to Cl. 11-3. A limit of 80% is too advantageous when taking into account that the average age of the fleet is far higher today than 30-40 years ago, that the international marine insurance market relies on a condemnation limit of 100%, and that the value of the concession is part of the insurable value of fishing vessels, at the same time as this value is retained by the assured in a condemnation settlement.
Clause 17-11. Condemnation/Ref. Clause 11-3
Instead of Cl. 11-3, sub-clause 2, first sentence, the following shall apply: The conditions for condemnation are met when casualty damage is so extensive that the costs of repairing the vessel will amount to at least 90 % of the insurable value or of the value of the vessel after repairs if the...
-
Clause 17-12. Damage to the hull of vessels which are not built of steel/Ref. Clause 12-1
View Clause Go to Plan pageSub-clause 1 (a) is first and foremost relevant to insurance of vessels deserving of preservation.
Sub-clause 1 (b) is not intended to cover more unforeseeable forms of striking against ice, e.g. where an ice floe has drifted out from a branch of a fjord to an open area of water where there is normally no ice.
Sub-clause 1 (c) excludes caulking of hull and deck. This is typical maintenance work, and it will not be easy to decide to what extent the caulking has been necessitated by the casualty. The exclusion does not cover expenses incurred in caulking those parts of hull and deck which must be replaced as a result of the casualty. Here the caulking represents a normal cost of renewal of a part of the vessel, and it must therefore be covered.
Clause 17-12. Damage to the hull of vessels which are not built of steel/Ref. Clause 12-1
In the event of damage to the hull of vessels which are not built of steel, the insurer is not liable for: distortion of the keel or damage resulting therefrom. The same applies to a depreciation in value caused by the fact that repairs are not carried out, damage resulting from striking against ...
-
Clause 17-13. Limited cover of damage to machinery
View Clause Go to Plan pageThe 2023 Version introduced a new term for “engine room”, cf. Cl. 12-16 with commentaries.
Cl. 17-13 provides limited cover for damage to machinery. On the other hand, extended cover for damage to machinery may be effected in accordance with Cl. 17-18.
The first part of the first sentence specifies that the insurer is “only” liable for the enumerated perils.
The second part of the first sentence states the perils covered by the insurer. This part of the provision was amended in the 2013 Plan. The damage must be a result of collision, striking, an earthquake, an explosion outside spaces containing machinery or battery packs, fire, or of the vessel having sunk or capsized. The term “engine room” is replaced by “spaces containing machinery or battery packs” as modern vessels might have several rooms or separate spaces containing machinery for propulsion or vessel operation (cf. commentaries to Cl. 12-16). Further, it is new in the 2013 Plan that the insurer is liable where the vessel has been filled with water as a result of a breach of a hose or a pipe onboard the vessel. The breach may occur on the hose/pipe itself or at any couplings/sockets, provided the hose or pipe couplings/sockets are fitted either in accordance with Nordic Boat Standard or public statutory rules applicable to the vessel. Thus, consequential damage of a leakage which arises suddenly and unexpectedly and is a result of external influence or faulty material will be covered. Such damage is not covered if attributable to a breach of a hose or a pipe that has not been statutory fitted as described above. The insurer will cover that peril provided the breach was not caused by corrosion or age. A breach caused by corrosion or age is a maintenance issue or rather lack of maintenance. It is the duty of the assured to carry out maintenance. The insurer’s liability for “the vessel having sunk or capsized” also applies when the vessel is moored.
The second sentence stipulates an exception to the rule in the first sentence as regards damage to electronic equipment. If such damage is caused by bad weather and the same casualty causes damage to hull or superstructure, the damage to the electronic equipment shall be covered.
Clause 17-13. Limited cover of damage to machinery
Unless otherwise agreed in the insurance contract, the insurer is only liable for damage to: machinery with accessories, plant machinery used for preparing or processing catch, etc., seine winch, line hauler, trawl winch or other hauling device for fishing gear, fish pumps, etc., pipelines and...
-
Clause 17-14. Costs incurred in saving time/Ref. Clause 12-7, Clause 12-8, Clause 12-11 and Clause 12-12
View Clause Go to Plan pageThe provision excludes the time-loss element in the ordinary hull conditions from the cover under the coastal hull insurance conditions.
Clause 17-14. Costs incurred in saving time/Ref. Clause 12-7, Clause 12-8, Clause 12-11 and Clause 12-12
The insurer is not liable for costs incurred in connection with: temporary repairs under Cl. 12-7, sub-clause 2, in excess of what the insurer saves by a postponement of the final repairs, the fact that the assured pursuant to the rules in Cl. 12-8 expedites repairs by extraordinary measures in...
-
Clause 17-15. Deductions/Ref. Clause 12-15, Clause 12-16 and Clause 12-18
View Clause Go to Plan pageSub-clause (a) refers to ice damage. This sub-clause was amended in the 2013 Plan. Previous versions of the Plan stated that damage resulting from striking against or contact with ice north of 75° north latitude and the waters of Greenland, including the Strait of Denmark, was covered subject to specified deductions. According to the 2013 Plan the deduction will be the subject of individual negotiations where inter alia the strength of the hull and ice class will be taken into account. According to the Plan, the deduction applies only to partial damage in accordance with the general system of the Plan.
Sub-clause (b) refers to electronic equipment. The deduction will be the subject of individual negotiations where inter alia the age of the equipment can be taken into account. It is therefore unnecessary to make the size of the deduction dependent on the age of the equipment in the actual Plan text.
The term “electronic equipment” covers three main groups, viz. radio equipment, fish-finding equipment and navigation equipment.
Radio equipment includes main transmitters with short-wave and receiver, watch-receivers, AM-VHF telephone monitors, VHF transmitters and receivers, lifeboat transmitters, direction-finding beacons, emergency communication sets for aircraft frequency, receivers and TVs for mess rooms or cabins, walkie-talkie transmitters and receivers, equipment for communication between bridge, engine room, cabins, mess rooms, and deck, and weather map recorders.
Fish-finding equipment includes sonars, display screens, echo sounders, echo enlargements connected to main sounders, trawl monitors, echo scopes, echo sounders for trawl probes and probe receivers.
Navigation equipment includes gyrocompasses, autopilots, course controllers, all types of radar, electronic logs for satellite navigators and display screens, radio sounders for AM VXF and WT, satellite navigators, Omega receivers and Loran C receivers.
In addition to deductions for electronic equipment, the Plan’s rules relating to machinery damage deductions and deductibles, cf. Cl. 12-16 and Cl. 12-18 shall apply. For the sake of clarity, this is repeated in sub-clauses (c) and (d). As regards the basis for calculating the various deductions, Cl. 12-19 applies so that all deductions shall be calculated on the basis of the full amount of compensation according to the Plan before deductions under any of the relevant provisions.
Given that the normal cover has not allowed for new for old deductions, the age of the vessel and the machinery, possibly also the sum insured, shall be taken into account when determining deductions and deductibles. In the event that the agreed deductions do not compensate for the lack of new for old deductions, the insurer may have to agree on individual new for old deductions.
Clause 17-15. Deductions/Ref. Clause 12-15, Clause 12-16 and Clause 12-18
Ice damage deduction, cf. Cl. 12-15: Damage resulting from striking against or contact with ice is covered subject to the deductions stated in the insurance contract. Electronic equipment damage deduction: Damage to electronic equipment is covered subject to the deductions stated in the insuranc...
-
Clause 17-16. Collision liability for fishing vessels/Ref. Clause 13-1
View Clause Go to Plan pageThis cover follows Cl. 13-1 as regards general liability for collision and striking. The purpose of this amendment is to ensure that cover includes collision and striking with aquaculture structures, which are not covered under P&I insurance. However, cover for collision has now been generalised. At the same time, however, this cover has been limited with regard to collision with vessels and with fishing, whaling or sealing tackle, cf. below.
Under sub-clause (a), cover in the event of “collision with or striking against” another vessel is limited to damage caused to the vessel with fixed accessories. Thus the insurance does not cover floating accessories. “Fixed accessories” means equipment which is normally on board, but is not necessarily “nailed down”. Catch, fishing gear and dories which are not lifeboats are examples of objects which do not constitute “fixed accessories”. Loss of catch and other loss of time are also outside the scope of cover. The provision refers to the “knock-for-knock” principle which is mentioned in the Commentary on Cl. 17-9. When several vessels participate in the same fishing team, collisions between the individual vessels and fishing gear, catch and dories which are in the sea are foreseeable. It serves little purpose to use resources on a detailed distribution of liability in such cases. It is therefore assumed that each fishing vessel owner covers damage to his own equipment. A natural extension of such a “knock-for-knock” principle is to exclude such damage from the liability insurance of the person who has caused the damage.
Under sub-clause (b), the insurer does not cover any liability for collision with or striking against fishing, whaling or sealing tackle in the sea. This limitation is explained by the fact that this liability is covered under P&I conditions. Sub-clause (c) is identical to sub-clause 2 in earlier versions. The provision is a continuation of the “knock-for-knock” principle mentioned above. When several vessels participate in the same fishing team or operate as pair trawlers, it is expedient to further limit the cover, thereby also excluding damage to or loss of the vessel with fixed accessories from the collision liability.
Clause 17-16. Collision liability for fishing vessels/Ref. Clause 13-1
In addition to the limitations in Cl. 13-1, sub-clause 2, the following shall apply: In the event of a collision with or striking against another vessel, the insurer's liability under Cl. 13-1 is limited to damage caused to the vessel with fixed accessories. The insurer does not cover any liabili...
-
Clause 17-17. Collision liability/Ref. Clause 13-1
View Clause Go to Plan pageThe heading and the Clause was amended in 2016 to make it applicable for all types of vessels insured under Chapter 17. The amended wording is partly mere editorial. Also, by adding the new sentence “By a call is meant arrival, anchoring, working, discharging, loading and leaving”, it is made clear that the insurance does not cover any collision liability to the relevant structure or any fish contained therein during the whole period when the insured vessel is calling at the structure. The previous wording was by some owners read to the effect that the exclusion of cover for collision liability only applied if damage occurred during loading or discharge.
The provision emphasises that the exclusion also comprises damage to the actual device and shall apply irrespective of what is loaded or discharged. The provision is first and foremost aimed at floating devices which are easily damaged, such as where the vessel runs into an enclosure for fish and the fish escape. In such cases it is difficult or impossible to determine the extent of damage. The application of the provision is not subject to the condition that there is loss of or damage to live fish; the deciding factor is the nature of the device. If there are several independent devices in the same area, however, liability to another device than the one from which loading or discharging shall take place will be covered.
Clause 17-17. Collision liability/Ref. Clause 13-1
In addition to the limitations in Cl. 13-1, sub-clause 2, the following shall apply: The insurer does not cover liability under Cl. 13-1 for damage to or loss of fish or structures for keeping live fish, where the loss or damage occurs in connection with a call at the relevant structure. By a cal...
Clause 17-7. The relationship to Chapters 10-13
The rules in Chapters 10-13 shall apply together with the amendments that follow from Cl. 17-7A and Cl. 17-10 to Cl. 17-17.