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Section 7
Continuation and extension
A. Should the entered ship at the expiration of this insurance be at sea or in distress or at a port of refuge or a port of call, she shall, provided previous notice be given to the Managers, be held covered at an additional pro rata daily Call/Premium to her port of destination. However, in case of a total loss of the entered ship during such period of extension, a further additional 6 (six) months Call/Premium shall be paid to the Association.
B. Unless the Managers agree to the contrary in writing, this insurance under Sections 2 and 3 of Rule 5 shall terminate automatically at the time of:
i. change of the Classification Society of the entered ship, or change, suspension, discontinuance, withdrawal or expiry of her Class therein, provided that if the entered ship is at sea such automatic termination shall be deferred until arrival at her next port. However, where such change, suspension, discontinuance, or withdrawal of her Class has resulted from loss or damage covered under Rule 5 such automatic termination shall only operate should the entered ship sail from her next port without the prior approval of the Classification Society.
ii. any change, voluntary or otherwise, in the ownership or flag,transfer to new management, or charter on a bareboat basis, or requisition for title or use of the entered ship, provided that, if the entered ship has cargo on board and has already sailed from her loading port or is at sea in ballast, such automatic termination shall if required by the Member be deferred, whilst the entered ship continues her planned voyage, until arrival at final port of discharge if with cargo or at port of destination if in ballast.
C. In case of any breach of the warranty or particular terms of the entry of the entered ship as to cargo, voyage, trading limit, towage, salvage services or date of sailing, this insurance under Rule 5 shall terminate automatically unless notice be given to the Managers immediately after receipt of advices and any amended terms of cover and any additional Call/Premium required by the Managers be agreed.
Section 8
Returns
Returns of Advance Call/Premium under Section 2 or Section 3 of Rule 5 shall be allowed under the following circumstances:
A. If the insurance of the entered ship in the Association is withdrawn or terminated, without prejudice to the effects of Rules 16, 18, 24, 25 and 26, the Advance Call shall be returned pro rata daily net for the period from the date of the withdrawal or the termination to the date of the expiration of the contemplated insurance. Notwithstanding the above, this paragraph [A] shall not be applicable to the automatic termination of insurance under paragraph [C] of Section 7 of Rule 5.
B. Where the entered ship is laid up in a port or lay-up area approved by the Association for a period exceeding 30 (thirty) consecutive days irrespective of whether she is under repairs in dock or shipyard, loading or discharging, 50% (fifty percent) of net Advance Call/Premium for such period shall be returned pro rata daily.
In the event of any return recoverable under this paragraph [B] being based on 30 (thirty) consecutive days which fall on successive insurances effected for the same Member, the Association shall only be liable for an amount calculated at pro rata for the number of days which come within the period covered by the Association.
PROVIDED ALWAYS that
In no case shall such return be recoverable under paragraphs [A] and [B] above in the event of a total loss of the entered ship, whether by insured risks or otherwise during the period covered by the Association or any extension thereof.
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