Clause 9-1. Definitions
“Claims leader” means the insurer who, at the time the insurance contract is entered into, is identified as claims leader.
“Co-insurers” means insurers who have accepted a proportion of the insurance of the interest against the same perils and who are directly liable to the assured.
Clause 9-2. The right of the claims leader to act on behalf of co-insurers
Unless otherwise agreed, the claims leader is entitled to take the steps referred to in Cl. 9-3 to Cl. 9-9 with binding effect on the co-insurers. In all such cases the claims leader shall, as far as possible, take into consideration the interests of all the insurers.
Notwithstanding that the claims leader has acted contrary to agreements with the co-insurers, or otherwise disregarded their interests, steps taken by the claims leader in matters governed by Cl. 9-3 to Cl. 9-8 shall be binding on the co-insurers in relation to the assured, unless the assured knew or ought to have known of the facts.
Unless otherwise agreed, the claims leader is authorized on behalf of the co-insurers to:
- receive notice of mortgage triggering the additional rights of the mortgagee as set out in Cl. 7-1, sub-clause 2;
- agree to special requirements of the mortgagee, provided that the special requirements are within customary market practice. Cl. 9-2, sub-clause 2 applies accordingly.
The claims leader shall confirm to the mortgagee receipt of notice of mortgage under sub-clause 3 (a) above.
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Clause 9-2. The right of the claims leader to act on behalf of co-insurers
Sub-clauses 3 and 4 were new in the 2023 Version and the aim is mainly to clarify the authority of the claims leader to act on behalf of the co-insurers and to enhance the administrative benefits of having a claims leader.
Clause 9-3. Lay-up plan
The claims leader may approve lay-up plans as required by Cl. 3-26.
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Clause 9-3. Lay-up plan
According to Cl. 3-26, the assured shall if the vessel is to be laid up draw up a lay-up plan and submit it to the insurer for his approval. It is not practical to send this plan to all the co-insurers; it must be sufficient that it is approved by…
Clause 9-4. Notification of a casualty
Notifications in connection with a casualty may be given to the claims leader.
The claims leader shall, as soon as possible, pass on such notifications to the co-insurers concerned, including claims advice with estimated costs.
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Clause 9-4. Notification of a casualty
This Clause was amended in the 2013 Plan.
Clause 9-5. Salvage
The claims leader may take measures with a view to salvage. The claims leader may inform the assured that the salvage operation has been abandoned or that the insurers will limit their liability for the costs in accordance with Cl. 4-21.
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Clause 9-5. Salvage
The provision authorises the claims leader to decide if, and in the event how, a salvage operation shall be conducted, and to decide when to abandon the salvage operation or whether the insurer shall exercise his authority to limit his liability for the salvage costs by paying the sum insured.…
Clause 9-6. Removal and repairs
The claims leader takes decisions pursuant to Cl. 3-20 and Cl. 12-10 to Cl. 12-13. If the assured has requested a condemnation of the vessel, the claims leader will also decide whether the vessel shall be moved in accordance with Cl. 11-6.
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Clause 9-6. Removal and repairs
The provision authorises the claims leader to grant requests for removal to a repair yard under Cl. 3-20 and to make decisions concerning repairs.
Clause 9-7. Provision of security
If the claims leader has provided security on behalf of the co-insurers for loss or liability covered under the insurance, the claims leader may claim a commission of 1 % of the provided security amount. If an open guarantee is provided, the commission shall be calculated on the basis of the effective gross loss or gross liability.
If a co-insurer has been notified that the claims leader has provided a security in accordance with sub-clause 1, the co-insurer is liable for its proportionate share of the liability directly to the claims leader and cannot discharge its liability by paying directly to the assured or any co-insured parties.
The co-insurer may not set off against the claims leader counterclaims against the assured, unless the co-insurer has made a special reservation to that effect prior to the provision of security.
If requested by the claims leader, the co-insurer shall provide countersecurity for its proportionate share of the liability.
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Clause 9-7. Provision of security
Sub-clauses 1 and 2 were amended in the 2023 Version. A new sub-clause 4 was included in the 2027 Version with a general update of the Commentary to this provision.
Clause 9-8. Disputes with third parties
If a third party makes a claim against the assured which is covered by the insurance, or if the assured has a claim for damages to which the insurers are subrogated, the claims leader shall decide questions concerning the institution of legal proceedings, appeals and amicable settlements.
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Clause 9-8. Disputes with third parties
This Clause is identical to earlier versions of the 1996 Plan. The Commentary was amended in the 2007 Version in accordance with the amendment to Cl. 9-2.
Clause 9-9. Claims adjustment
The claims leader shall see to it that a claims adjustment is drawn up. The adjustment is binding on co-insurers, provided that it is in accordance with the insurance conditions.
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Clause 9-9. Claims adjustment
The Commentary was amended in the 2027 Version due to the amendments in Cl. 1-4B and Cl. 1-4C.
Clause 9-10. Insolvency of a co-insurer
If a co-insurer is insolvent, the assured shall cover its proportion of expenses incurred by the claims leader on behalf of the assured. The insolvent co-insurer’s share of expenses incurred by the claims leader on behalf of all of the insurers shall be shared pro rata by the claims leader and the other co-insurers.
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Clause 9-10. Insolvency of a co-insurer
This Clause was amended in the 2013 Plan.
The provision regulates the risk of a co-insurer becoming insolvent when the claims leader has had disbursements, part of which the co-insurer should have paid.
Clause 9-11. Interest on the disbursements of the claims leader
The claims leader is entitled to charge interest on disbursements it has made on behalf of all of the insurers or the assured. Cl. 5-4 shall apply correspondingly.
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Clause 9-11. Interest on the disbursements of the claims leader
In practice, the claims leader will often make disbursements on behalf of all the insurers, e.g. for surveys. Accordingly, there is a need for a rule which entitles him to charge interest on these disbursements. For disbursements made by the claims leader on behalf of the assured, the duty of…
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Clause 9-1. Definitions
This Clause was amended in the 2027 Version of the Plan. The previous sub-clause 2 stated that co-insurers mean “other insurers” whilst the word “other” has now been deleted.