Clause 2-8. Perils covered by an insurance against marine perils
An insurance against marine perils covers all perils to which the interest may be exposed, with the exception of:
- perils covered by an insurance against war perils in accordance with Cl. 2-9,
- capture at sea, confiscation, expropriation and other similar interventions by own State power provided any such intervention is made for the furtherance of an overriding national political objective. Own State power is understood to mean the State power in the vessel’s State of registration or in the State where the major ownership interests are located. Own State power does not include individuals or organisations exercising supranational authority,
- requisition by State power,
- insolvency or lack of liquidity of the assured or the operation of ordinary legal process to enforce payment of any fine, penalty, debt or right to security unrelated to a claim or liability covered by the insurance,
- perils covered by the RACE II Clause:
- ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the combustion of nuclear fuel,
- the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other nuclear assembly or nuclear component thereof,
- any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter,
- the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter. The exclusion in this sub-clause does not extend to radioactive isotopes, other than nuclear fuel, when such isotopes are being prepared, carried, stored, or used for commercial, agricultural, medical, scientific or other similar peaceful purposes,
- any chemical, biological, bio-chemical, or electromagnetic weapon.
Clause 2-9. Perils covered by an insurance against war perils
An insurance against war perils covers:
- war or war-like conditions, including civil war or the use of arms or other implements of war in the course of military exercises in peacetime or in guarding against infringements of neutrality,
- capture at sea, confiscation, expropriation and other similar interventions by a foreign State power, provided any such intervention is made for the furtherance of an overriding national or supranational political objective. Foreign State power is understood to mean any State power other than own State power as defined in Cl. 2-8 (b), second sentence, as well as organisations and individuals exercising supranational authority or who unlawfully purport to exercise public or supranational authority,
- riots, sabotage, acts of terrorism or other social, religious or politically motivated use of violence or threats of the use of violence, strikes or lockouts,
- piracy and mutiny,
- measures taken by a State power to avert or limit damage, provided that the risk of such damage is caused by a peril referred to in sub-clause 1 (a) – (d).
The insurance does not cover:
- insolvency or lack of liquidity of the assured or the operation of ordinary legal process to enforce payment of any fine, penalty, debt or right to security unrelated to a claim or liability covered by the insurance,
- perils covered by the RACE II Clause:
- ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the combustion of nuclear fuel,
- the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other nuclear assembly or nuclear component thereof,
- any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter,
- the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter,
- any chemical, biological, bio-chemical, or electromagnetic weapon,
- requisition by State power.
View Commentary Hide Commentary
Clause 2-9. Perils covered by an insurance against war perils
The Commentary was amended in the 2027 Version of the Plan.
Clause 2-10. Perils insured against when no agreement has been made as to what perils are covered by the insurance
Unless otherwise agreed, the insurance covers only marine perils.
View Commentary Hide Commentary
Clause 2-10. Perils insured against when no agreement has been made as to what perils are covered by the insurance
This Clause is identical to Cl. 17 of the 1964 Plan.
Clause 2-11. Causation. Incidence of loss
The insurer is liable for loss incurred when the interest insured is struck by an insured peril during the insurance period.
If an unknown defect results in damage to the insured vessel, the defect shall be deemed to be a marine peril that strikes the interest insured at the time the damage starts to develop.
If unknown damage in one part of the vessel results in damage to another part or parts of the vessel, the original damage shall be deemed to be a marine peril that strikes the interest insured at the time the damage to the other part or parts starts to develop.
Where a defect or damage existing at the inception of the insurance, which is known to the assured but not to the insurer, gives rise to damage (in the case of defects) or new damage to other parts (in the case of existing damage), the liability of the insurer shall not exceed the amount the assured would have been able to recover under the insurance on risk at the time the assured first acquired knowledge of the relevant defect or damage.
View Commentary Hide Commentary
Clause 2-11. Causation. Incidence of loss
The Commentary was amended in the 2027 Version.
Clause 2-12. Main rule relating to the burden of proof
The assured has the burden of proving that it has suffered a loss of the kind covered by the insurance and of proving the extent of the loss.
The insurer has the burden of proving that the loss has been caused by a peril that is not covered by the insurance, unless other provisions of the Plan provide to the contrary.
The assured has the burden of proving that the loss has not been caused by such perils as are mentioned in Cl. 2-8 (e) and Cl. 2-9, sub-clause 2 (b).
View Commentary Hide Commentary
Clause 2-12. Main rule relating to the burden of proof
The wording of Cl. 2-12 has not been amended, but the Commentary has been rewritten for the 2013 Plan.
Clause 2-13. Combination of perils
If the loss has been caused by a combination of different perils, and one or more of these perils are not covered by the insurance, the loss shall be apportioned over the individual perils according to the influence each of them must be assumed to have had on the occurrence and extent of the loss, and the insurer shall only be liable for that part of the loss which is attributable to the perils covered by the insurance.
If a peril that is excluded from cover in Cl. 2-8 (e) and Cl. 2-9, sub-clause 2 (b), has directly or indirectly caused or contributed to the loss, the entire loss shall be attributed to that peril.
View Commentary Hide Commentary
Clause 2-13. Combination of perils
Sub-clause 2 was amended in the 2007 Version. The Clause is otherwise identical to earlier versions of the 1996 Plan.
Clause 2-14. Combination of marine and war perils
If the loss has been caused by a combination of marine perils, cf. Cl. 2-8, and war perils, cf. Cl. 2-9, the whole loss shall be deemed to have been caused by the class of perils which was the dominant cause. If neither of the classes of perils is considered dominant, both shall be deemed to have had equal influence on the occurrence and extent of the loss.
View Commentary Hide Commentary
Clause 2-14. Combination of marine and war perils
This Clause is identical to Cl. 21 of the 1964 Plan.
Clause 2-15. Losses deemed to be caused entirely by war perils
War perils shall always be deemed to be the dominant cause of:
- loss arising when the vessel is damaged through the use of arms or other implements of war for war purposes, or in the course of military manoeuvres in peacetime or in guarding against infringements of neutrality,
- loss attributable to the vessel, in consequence of war or war-like conditions, having a foreign crew placed on board which, wholly or partly, deprives the master of free command of the vessel,
- loss of or damage to a life-boat caused by it having been swung out due to war perils, and damage to the vessel caused by such a boat.
View Commentary Hide Commentary
Clause 2-15. Losses deemed to be caused entirely by war perils
This Clause is identical to Cl. 22 of the 1964 Plan.
Clause 2-16. Loss attributable either to marine or war perils
If it is evident that a loss has been caused either by marine perils, cf. Cl. 2-8, or by war perils, cf. Cl. 2-9, without it being possible to identify one or the other class as the more probable cause, the rule contained in Cl. 2-14, second sentence, shall apply correspondingly.
View Commentary Hide Commentary
Clause 2-16. Loss attributable either to marine or war perils
This Clause is identical to Cl. 23 of the 1964 Plan.
Clause 2-17. Sanctions limitation and termination
This Clause shall be paramount and shall override any other clauses inconsistent therewith.
No insurer shall be deemed to provide cover and no insurer shall be liable to pay any claim or provide any benefit hereunder to the extent that the provision of such cover, payment of such claim or provision of such benefit may expose that insurer and/or its reinsurers to any sanction (whether primary or secondary), prohibition or restriction under United Nations resolutions or the trade or economic sanctions, laws or regulations of the European Union, the United Kingdom, the United States of America or any State where the insurer or its reinsurers have their registered office or permanent place of business.
In the event that the provision of insurance cover has exposed or may expose the insurer or its reinsurers to the risk of any sanction prohibition or restriction as set out in sub-clause 1 above, the insurer shall be entitled to terminate the insurance with immediate effect by giving notice in writing. Termination also applies to the rights of the mortgagee. The insurer shall immediately notify the mortgagee of the termination.
In the event that an insurer is designated, listed or otherwise made subject to asset freeze or similar restrictive measures under sanction regimes by the United Nations, European Union, United Kingdom, United States of America or any State where the assured has its registered office or permanent place of business, the assured shall have the right to terminate the insurance with this insurer with immediate effect by written notice.
View Commentary Hide Commentary
Clause 2-17. Sanctions limitation and termination
The Clause was new in Version 2016. Sub-clause 1 was amended in Version 2023 by deleting the reference to France, the Russian Federation and the People’s Republic of China, aligning the Clause with other market clauses. Further amendments were made to the Clause and Commentary in Version 2027.
Clause 2-18. Know Your Customer (KYC)
The insurance cover is subject to satisfactory identification and assessment of the customer and/or assured(s) as per the insurer’s customer due diligence measures relating to anti-money laundering, counter-financing of terrorism, and sanctions laws and regulations applicable to the insurer and/or its reinsurers and/or the law governing the insurance contract.
Prior to inception of the insurance contract, the customer and/or assured(s) is under an obligation to provide the insurer with all relevant information to allow the insurer to conduct its own customer due diligence measures. To the extent the insurer receives personal data as part of its due diligence measures, the insurer shall comply with all applicable laws relating to the protection of personal data.
During the insurance period, the customer and/or assured(s) is under a continuous obligation to promptly provide the insurer with all information relevant to the insurer’s customer due diligence measures, and to disclose any changes to the information already provided to the insurer.
If the insurer determines that the information received is not satisfactory or the requested information is not provided, the insurer shall notify the customer and/or assured and request additional information. If the customer and/or assured does not provide such additional information within fourteen days, the insurer may terminate the insurance contract by giving fourteen days’ notice, or by a shorter notice period if required by law.
View Commentary Hide Commentary
Clause 2-18. Know Your Customer (KYC)
The Clause was new in the 2027 Version.
View Commentary Hide Commentary
Clause 2-8. Perils covered by an insurance against marine perils
The Commentary was amended in the 2027 Version of the Plan.
An insurance against marine perils covers “all perils to which the interest may be exposed”, cf. sub-clause 1, first sentence. There are five positive exceptions from this point of departure, viz.: