Ancillary Covers

36 Pages·2013·0.5 MB·English

Ancillary Covers
Ancillary Covers
September/2007
P&I Charterer’s Liability 3
Slot Charter Insurance 4
Charterer’s Interest 5
Charterer’s All Inclusive Cover 6
All Inclusive S.O.L. Shipowner’s Liability Cover 9
S.O.L. Shipowner’s Liability 10
All inclusive Crew Cover 11
Crew Familiarisation Liability Cover 12
Pre-Delivery Crew Cover 13
Deviation Insurance 14
Passenger Deviation 15
Exxon GA Clause Insurance 16
North America Clean-Up Cover 17
Cash on Board 18
Cargo on Deck 20
Ad Valorem: Specie and Valuable Cargo 21
FD&D Newbuilding 22
H&M Increased Value/Hull Interest 23
Freight Interest 25
Freight All Risk 26
Stores and Provision 27
Loss of Hire 28
General Average Insurance 30
Purchaser’s/Seller’s Interest 31
Loss of Anticipated Profits 32
Commission Interest 33
Mortgagee’s Interest Insurance 34
Innocent Owners Interest Insurance 35
Bunker Insurance 36
Charterer’s Liability
Narrative
A person or a company acting as charterer of a ship assumes responsibilities broadly similar to those of an
owner. The contracting parties - normally a cargo owner or sub-charterer - will view the charterer as the
“owner” of the ship. The charterer also assumes liabilities towards the vessel owner, including damage inflicted
on the ship.
Description
Most ships are chartered either on a Time Charter or Voyage Charter contract. In both cases the charterer
becomes liable as he occupies a position similar to an owner towards the sub-contracting party (either a sub-
charterer or cargo owner). His liabilities towards third parties are then broadly similar to those of a shipowner
including liabilities for cargo and oil pollution.
Simultaneously, the charterer assumes liabilities towards the party he charters the ship from - the vessel
owner or another charterer. Primarily, this type of liability relates to vessel damage caused by, for instance,
cargo-handling, unsafe port or berth and bad bunkers.
Charterers in any role, whether as voyage charterers or time charterers, need cover for this exposure. Even
where the charterparty contractually imposes the liability on the shipowner, most jurisdictions allow a claim-
ant to pursue compensation from a party he finds most suitable. The claimant has freedom of choice, to sue
either the charterer or the owner. The charterparty will eventually determine, contractually, who should bear
the cost, but this may follow a long legal process. Charterer’s Liability insurance is a P&I cover primarily, but
for charterers with a fixed premium.
Since claims between an owner and a charterer frequently concern hull damages the cover may also
include Charterer’s Liability to Hull. Even if the contract is on a Voyage Charter, where the shipowner may
have an obligation to ensure named ports are safe for his ships, the charterparty may name a range of ports
for discharge. If the port is unsafe, the charterer may have a liability to the shipowner, should damage to
the ship occur. Stevedore damage to vessels is commonplace when loading or discharging cargo. This is yet
another typical liability imposed on the charterer.
All charterers, regardless of position in the “chartering chain”, require cover for both P&I liabilities and dam-
age to hull. As soon there is a binding fixture, whether voyage or time charter, the charterer has an insurable
exposure.
This note is a general description of Charterer’s Liability insurance. For more detailed information, please
refer to the slip or Certificate of Entry.
Conditions
• The cover is based on The Swedish Club Rules for Protection & Indemnity, Rule 9.
• Including Damage to Hull, as per Club Rules.
• Including War.
Vers. 2/sept/2007
www.swedishclub.com
Slot Charter Insurance
Narrative
A person or a company acting as charterer of a ship assumes responsibilities broadly similar to those of an
owner. The contracting parties - normally a cargo owner or sub-charterer - will view the charterer as the
“owner” of the ship. The charterer also assumes liabilities towards the vessel owner, including damage inflicted
on the ship.
Description
Most ships are chartered either on a Time Charter or Voyage Charter contract. In both cases the charterer
becomes liable as he occupies a position similar to an owner towards the sub-contracting party (either a sub-
charterer or cargo owner). His liabilities are broadly similar to those of a shipowner, with liability to cargo, to
freight and, in rare circumstances, also to pollution claims.
Simultaneously, he assumes liabilities towards the party he charters the ship from - the vessel owner or
another charterer. Primarily, this type of liability relates to damage caused to the ship in the course of cargo-
handling, such as stevedore damage or damage resulting from an unsafe port or berth.
Charterers in any role, whether as voyage charterers or time charterers, need cover for this exposure. Even
where the charterparty contractually imposes the liability on the shipowner, most jurisdictions allow a claimant
to pursue compensation from a party he finds most suitable. The claimant has freedom of choice, to sue either
the charterer or the owner. The charterparty will eventually determine, contractually, who should bear the cost,
but this may follow a long legal process. Some charterparties provide a clear definition of the division of blame
(such as the NYPE). Charterer’s Liability Insurance is a P&I cover primarily, but for charterers with a fixed
premium.
Many claims between owner and charterer refer to stevedore damage or unsafe port or berth. Therefore, in
addition to the P&I cover, this cover may also include Charterer’s Liability to Hull. Even if the contract is on a
Voyage Charter, where the shipowner has an obligation to ensure named ports are safe for his ships, the char-
terparty may name a range of ports for discharge. If the port is unsafe, the charterer may have a liability to
the shipowner, should damage to the ship occur. Stevedore damage to vessels is commonplace when loading
or discharging cargo. This is yet another typical liability imposed on the charterer.
All charterers, regardless of position in the “chartering chain”, require cover for both P&I liabilities and dam-
age to hull. As soon as the contract is signed, whether voyage or time charter, the charterer has an insurable
exposure.
Slot Charter Insurance is designed for a situation in which the charterer only charters a limited space or a
number of slots on a vessel.
This note is a general description of Slot Charter Insurance. For more detailed information, please refer to
the slip or Certificate of Entry.
Conditions
• The cover is based on The Swedish Club Rules for Protection & Indemnity, Rule 9.
• Including Damage to Hull, as per Club Rules.
• Including War. Vers. 2/sept/2007
www.swedishclub.com
Charterer’s Interest
Narrative
A charterer - normally a time charterer - may have a further interest in the chartered vessel. For example, the
ship may be sub-let on a time charter or the charterer may have a purchase option. This interest is insurable.
Description
Charterers commonly charter ships either on a voyage or time charter basis. Primarily in the latter circumstances,
the chartered vessel represents future income. Naturally, should the ship be lost, the charterer will not pay
charter hire, but he may find it hard to secure a replacement vessel either at the same rate or a ship so suited to
the intended trade. As a result, the charterer may not earn the future freight, as anticipated.
In order to cover this exposure, the charterer can protect himself by a total loss insurance known as Charterer’s
Interest. Should the chartered ship become a total loss, the charterer will be indemnified by this cover.
As there is no entitlement to earn money on insurance, but rather only to make good losses - this cover is
often provided on a reducing basis. For example, if the charterer anticipates a profit of USD 1.2 million on the
vessel during a charter period of, say, one year, his interest when the charter is signed will be that sum. After
one month, however, he has earned USD 100,000 and, therefore, his insurable interest at the start of the
second month is reduced to USD 1.1 million. This cover is often written on a daily reducing basis. On the last
day of cover, where there is no future profit at risk, the insured amount is at zero.
This note is a general description of Charterer’s Interest insurance. For more detailed information, please
refer to the slip or Certificate of Entry.
Conditions
This cover is based on Charterer’s Interest on Increased Value, Total Loss Only.
• This insurance is subject to the Institute Time Clauses Hulls, Increased Value (including Excess Liabilities)
Total Loss Only - Time 1/10/83, to be interpreted according to Swedish Law with arbitration in Gothen-
burg, as per Arbitration Clause Gothenburg (B.1.1). Amended to Total Loss Only.
• The Articles of Association and current circulars.
• Radioactive Contamination, Chemical, Biological, Biochemical and Electromagnetic Weapons Exclusion
Clause C.1.3 (LSW 370, 2003-11-10).
• Institute Cyber Attack Exclusion Clause C.1.3.1 (LSW 380, 2003-11-10).
• Conditions for Hull and Machinery, where applicable.
• Cancellation returns only.
• Warranted not including War, terrorism or similar risks being available under ordinary War Risks covers.
• Reducing: the insured amount in this policy reduces by USD (amount) per day/month from date of
inception.
• Premiums and rates are calculated on the insured amount at inception of the policy.
• Premiums are payable quarterly in advance, 1 January, 1 April, 1 July and 1 October. Delay in payment
may render cancellation of cover and interest on delay, as per Rules of the Association.
• War included, if agreed.
Vers. 2/sept/2007
www.swedishclub.com
Charterer’s All Inclusive Cover
Narrative
A person or a company acting as charterer of a ship assumes responsibilities broadly similar to those of an
owner. The contracting parties - normally a cargo owner or sub-charterer - will view the charterer as the
“owner” of the ship. The charterer also assumes liabilities towards the vessel owner, including damage inflicted
on the ship.
In addition a charterer - normally a time charterer - may have a further interest in the chartered vessel. For
example, the ship may be sub-let on a time charter or the charterer may have a purchase option. This interest
is insurable.
Finally, the charterer may have an insurable interest if the chartered ship sustains damage resulting in a
particular average covered under the H&M policy. Furthermore, the lost earnings, in the case of a sub-let ship,
represent an insurable interest.
This insurance offers comprehensive cover in respect of the charterer’s liabilities, interest in the event of a
total loss and interest in the case of a particular average on the chartered ship.
Description
Charterer’s Liability
Most ships are chartered either on a Time Charter or Voyage Charter contract. In both cases the charterer
becomes liable as he occupies a position similar to an owner towards the sub-contracting party (either a sub-
charterer or cargo owner). His liabilities towards third parties are then broadly similar to those of a shipowner
including liabilities for cargo and oil pollution.
Simultaneously, the charterer assumes liabilities towards the party he charters the ship from - the vessel
owner or another charterer. Primarily, this type of liability relates to vessel damage caused by, for instance,
cargo-handling, unsafe port or berth and bad bunkers.
Charterers in any role, whether as voyage charterers or time charterers, need cover for this exposure. Even
where the charterparty contractually imposes the liability on the shipowner, most jurisdictions allow a claim-
ant to pursue compensation from a party he finds most suitable. The claimant has freedom of choice, to sue
either the charterer or the owner. The charterparty will eventually determine, contractually, who should bear
the cost, but this may follow a long legal process. Charterer’s Liability insurance is a P&I cover primarily, but
for charterers with a fixed premium.
Since claims between an owner and a charterer frequently concern hull damages the cover may also include
Charterer’s Liability to Hull. Even if the contract is on a Voyage Charter, where the shipowner may have an
obligation to ensure named ports are safe for his ships, the charterparty may name a range of ports for
discharge. If the port is unsafe, the charterer may have a liability to the shipowner, should damage to the ship
occur. Stevedore damage to vessels is commonplace when loading or discharging cargo. This is yet another
typical liability imposed on the charterer.
All charterers, regardless of position in the “chartering chain”, require cover for both P&I liabilities and damage
to hull. As soon as there is a binding fixture, whether voyage or time charter, the charterer has an insurable
exposure.
Vers. 2/sept/2007
www.swedishclub.com
Charterer’s All Inclusive Cover
Charterer’s Interest
Charterers commonly charter ships either on a voyage or time charter basis. Primarily in the latter circumstances,
the chartered vessel represents future income. Naturally, should the ship be lost, the charterer will not pay char-
ter hire, but he may find it hard to secure a replacement vessel either at the same rate or a ship so suited to the
intended trade. As a result, the charterer may not earn the future freight, as anticipated. In order to cover this
exposure, the charterer can protect himself by a total loss insurance known as Charterer’s Interest. Should the
chartered ship become a total loss, the charterer will be indemnified by this section of the cover.
This cover is often written on a daily reducing basis. On the last day of cover, where there is no future profit
at risk, the insured amount is at zero.
Charterer’s Loss of Hire
If the chartered ship is sub-let and the charterer wish to insure the difference between the charter rates paid
and received, this section of the cover will indemnify the charterer in the event that the ship sustains a par-
ticular average covered by the relevant H&M.
This section of the cover is also typically written on a daily reducing basis. On the last day of cover, with no
potential lost earnings at risk, the insured amount reaches zero.
This note is a general description of Charterer’s All Inclusive Cover insurance. For more detailed information,
please refer to the slip or Certificate of Entry.
Conditions
Charterer’s Liability
• The cover is based on The Swedish Club Rules for Protection & Indemnity, Rule 9.
• Including Damage to Hull, as per Club Rules.
• Including War.
Charterer’s Interest
This cover is based on Charterer’s Interest on Increased Value, Total Loss Only.
• This insurance is subject to the Institute Time Clauses Hulls, Increased Value (including Excess Liabilities)
Total Loss Only - Time 1/10/83, to be interpreted according to Swedish Law with arbitration in Gothen-
burg, as per Arbitration Clause Gothenburg (B.1.1). Amended to Total Loss Only.
• The Articles of Association and current circulars.
• Radioactive Contamination, Chemical, Biological, Biochemical and Electromagnetic Weapons Exclusion
Clause C.1.3 (LSW 370, 2003-11-10).
• Institute Cyber Attack Exclusion Clause C.1.3.1 (LSW 380, 2003-11-10).
• Conditions for Hull and Machinery, where applicable.
• Cancellation returns only.
Vers. 2/sept/2007
www.swedishclub.com
Charterer’s All Inclusive Cover
• Warranted not including War, terrorism or similar risks being available under ordinary War Risks covers.
• Reducing: the insured amount in this policy reduces by USD (amount) per day/month from date of
inception.
• Premiums and rates are calculated on the insured amount at inception of the policy.
• Premiums are payable quarterly in advance, 1 January, 1 April, 1 July and 1 October. Delay in payment
may render cancellation of cover and interest on delay, as per Rules of the Association.
• War included, if agreed.

Charterer’s Loss of Hire
• Full Norwegian conditions, in accordance with chapters 1-9 and 16 of the Norwegian Marine Insurance
Plan of 1996, latest version - all to be interpreted according to Norwegian law and with jurisdiction as
per §1-4 of the plan.
The Articles of Association and current circulars, with the following special conditions regarding limits, de-
ductibles and deductions:
• §16-4: Limit of cover per casualty and year, as agreed.
• §16-7: Deductible period, as agreed.
• §16-7: Additional Machinery Damage Deductible period, as agreed.
Club Clauses
• The Swedish Club Amended fleet clause A.1 – Fleet.
• The Swedish Club Claims Lead Clause A.4.
• The Swedish Club Tender Clause A.6.
• The Swedish Club Condition Survey Clause A.7.2.
• Radioactive Contamination, Chemical, Biological, Biochemical and Electromagnetic Weapons Exclusion
Clause C.1.3 (LSW 370, 2003-11-10).
• Institute Cyber Attack Exclusion Clause C.1.3.1 (LSW 380, 2003-11-10).
Vers. 2/sept/2007
www.swedishclub.com
All Inclusive S.O.L.
Shipowner’s Liability Cover
Narrative
There are numerous occasions when a shipowner has to deviate from the normal route or the agreed B/L. In
these situations, there is exposure to cargo liability. Such deviations to the B/L can be covered on the specific
occasions by the Club but we also offer an “All Inclusive S.O.L. cover” which provides for liberties to deviate
under the policy period.
Description
The “All-Inclusive S.O.L. cover” includes a number of specific liabilities that are mainly excluded from the P&I
cover. By tailor-making this cover for an individual member he may use this cover as a back-up to the P&I
during the policy period. Deductibles are similar as for P&I and this will thereby create a seamless cover for
the member. A brief description what this cover can include is:
Deviation cover
P&I rules clearly exclude any deviation ordered by the shipowner. A deviation may be for the purposes of
bunkering or crew change, but may also be for provisioning and taking on of spares. Not allowed deviations
frustrate the B/L and so denies the shipowner any limitations under the rules governing the B/L (e.g. the
Hague-Visby Rules). Should the deviation for any purpose be excluded from P&I cover, the shipowner requires
cover for the risk of breaching the B/L.
Extended ware-house cover
Cargo being accepted for shipment or delivery beyond the normal P&I rule of 14 days. The extended storage
prior or after the transport.
Lightering
Cargo being transhipped or lightered at a port. May not be covered under the P&I if it is a frustration of the B/L.
Dry-docking with cargo on board
The member decides to leave cargo on board during dry docking. This can be a breach of the B/L and thereby
not covered under P&I.
Storage of cargo whilst under repairs
Cargo may have to be temporarily stored whilst the vessel is undergoing repairs. This extended exposure may
be included in the cover.
Additional cover may include subject to special terms Ante dated Bill of Ladings.
This note is a general description of the All Inclusive S.O.L. cover. For more detailed information, please refer
to the slip or Certificate of Entry.
Conditions
The cover is based on:
• The member’s entry in The Swedish Club for P&I, but including liability excluded by the deviation/feed-
ering/transhipment/storage/lightering of the cargo, up to the agreed limit (the cargo value). Vers. 2/sept/2007
www.swedishclub.com
S.O.L. Shipowner’s Liability
Transshipment-Feeder-Storage Lightering-
Drydocking with Cargo
Narrative
There are several situations when a shipowner has to adopt measures and deviate from the normal procedures.
In these situations, there is exposure to cargo liability. S.O.L. cover is designed for such special cases.
Description
If a vessel has to drydock with cargo on board, the Bill of Lading may be frustrated and the shipowner will
loose P&I cover. S.O.L. insurance covers this additional exposure. This exposure also applies if a cargo has to
be transhipped, stored, feedered or lightered. The defence under the B/L is frustrated and P&I cover lost. The
potential liability is the value of the cargo declared.
This note is a general description of S.O.L. For more detailed information, please refer to the slip or Certifi-
cate of Entry.
Conditions
The cover is based on:
• The member’s entry in The Swedish Club for P&I, but including liability excluded by the feedering/tran-
shipment/storage/lightering of the cargo, up to the agreed limit (the cargo value).
Vers. 2/sept/2007
www.swedishclub.com