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D. Exclusions
Unless otherwise provided in Rule 5, the provisions under this paragraph [D] shall apply to all risks covered under these Rules, but paragraphs [D] [i], [iv] and [v] shall only apply to the cover under Rule 3.
i. Exclusion of sums insurable under Hull Policies or Hull Certificates Unless and to the extent that the Directors otherwise decide, or the Managers agree in writing as a term of entry, the Association shall not indemnify the Member of an entered ship against any liabilities, costs or expenses against which that Member would have been insured if at the time of the event giving rise to those liabilities, cost, or expenses the ship had been fully insured for its proper value under Hull Policies on terms equivalent to those of the Lloyd's Marine Policy MAR form 1/1/82 with the Institute Time Clauses Hulls 1/10/83 attached or under Hull Certificates on terms of Rule 5 of these Rules of the Association. For the purpose of these Rules, “proper value”shall mean the market value of the ship, without commitment, at the date of the event referred to above.
ii. Exclusion of war risks
The Association shall not indemnify a Member against any liabilities, costs or expenses (irrespective of whether a contributory cause of the same being incurred was any neglect on the part of the Member or on the part of the Member's servants or agents) when the loss or damage, personal injury, illness or death or other accident in respect of which such liability arises or cost or expense is incurred, was caused by:
(i) War, civil war, revolution, rebellion, insurrection or civil strife arising therefrom, or any hostile act by or against a belligerent power, or any act of terrorism (in the event of any dispute as to whether or not an act constitutes an act of terrorism, the decision of the Directors shall be final).
(ii) Capture, seizure, arrest, restraint or detainment (barratry and piracy excepted) and the consequences thereof or any attempt thereat;
(iii) Mines, torpedoes, bombs, rockets, shells, explosives or other similar weapons of war (save for those liabilities, costs or expenses which arise solely by reason of the transport of any such weapons whether on board the entered ship or not), provided always that this exclusion shall not apply to the use of such weapons either as a result of government order or with the written agreement of the Directors or the Managers where the reason for such use is the avoidance or mitigation of liabilities, costs or expenses which would otherwise fall within the cover given by the Association.
PROVIDED ALWAYS that
The Directors may resolve that special cover be provided to the Members against any or all of the risks set out in these Rules notwithstanding that those liabilities, costs or expenses would otherwise be excluded by this sub-paragraph [ii] and that such special cover should be limited to such sum or sums and be subject to such terms and conditions as the Directors may from time to time determine.
iii. Exclusion of nuclear risks
The Association shall not indemnify a Member against any liabilities, losses, costs or expenses directly or indirectly caused by or contributed to by or arising from
(i) ionising radiations from, or the radioactive, toxic, explosive or other hazardous or contaminating properties of
a. any nuclear fuel or any nuclear waste or the combustion of nuclear fuel, or
b. any nuclear installation, reactor or other nuclear assembly or nuclear component thereof; or
(ii) any weapon of war employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter,
PROVIDED ALWAYS that
a. this exclusion shall not apply to liabilities, losses, costs or expenses arising out of the carriage of "excepted matter" as cargo on an entered ship. For this purpose "excepted matter" consists of certain radio isotopes, used in or intended to be used for any industrial, commercial, agricultural, medical or scientific purpose and such further exceptions as the Directors may approve.
b. The Directors may resolve that special cover be provided to the Members against any or all of the risks set out in these Rules notwithstanding that those liabilities, losses, costs, or expenses would otherwise be excluded by this sub-paragraph [iii] and that such special cover should be limited to such sum or sums and be subject to such terms and conditions as the Directors may determine.
iv. Exclusion of damage to entered ship, loss of hire, etc
Subject to paragraph [F] of Section 20 and to Section 23 of Rule 3, the Association shall not, except as otherwise provided in this sub-paragraph, pay for:
(i) Loss of or damage to the entered ship or any part thereof;
(ii) Loss of or damage to any equipment on board the entered ship or to any containers, lashings, stores or fuel thereon, to the extent that the same are owned or leased by the Member or by any company associated with or under the same management as the Member;
(iii) The cost of repairs to the entered ship or any charges or expenses in connection therewith;
(iv) Claims by or against the Member relating to loss of freight or hire of an entered ship or any proportion thereof unless such loss of freight or hire forms part of a claim recoverable from the Member for liabilities in respect of cargo within the scope of these Rules or is, with the consent of the Managers, included in the settlement of such a claim;
(v) Salvage or services in the nature of salvage and any costs and expenses in connection therewith;
(vi) Loss arising out of cancellation of a charter or other engagement of an entered ship;
(vii) Loss arising out of irrecoverable debts or out of the insolvency of any person, including insolvency of agents;
(viii) Claims by or against the Member relating to demurrage on, detention of or delay to an entered ship unless such demurrage, detention or delay forms part of a claim recoverable from the Member for liabilities in respect of cargo within the scope of these Rules or is, with the consent of the Managers, included in the settlement of such a claim.
PROVIDED ALWAYS that
The exclusions of this sub-paragraph [iv] shall not apply to claims under the following Sections of Rule 3:
Section 11 Life Salvage.
Section 18 Unrecoverable general average contributions.
Section 19 Ship’s proportion of general average.
Section 21 Special compensation to Salvors.
Section 24 Sue and labour and legal costs.
Section 25 Expenses incurred by direction of the Association.
v. Exclusion of certain liabilities, costs and expenses of salvage ships, drilling ships, dredgers and others, specialist operation, diving etc.
Unless and to the extent that special cover shall have been agreed in writing between a Member and the Managers in accordance with the provisions of Rules 6 or 7, the Association shall not be liable for any claim relating to:
(i) Salvage operations
a. liabilities, costs and expenses arising out of salvage operations conducted by an entered ship or provided by a Member, other than liabilities, costs and expenses arising out of salvage operations conducted by an entered ship for the purpose of saving or attempting to save life at sea; and
b. liabilities, costs and expenses incurred by a Member (being a professional salvor) which are covered by a special agreement between that Member and the Association, and which arise out of the operation of, and in respect of the Member’s interest in the entered ship.
(ii) Drilling operations
Liabilities, costs and expenses incurred in respect of a drilling ship or barge or any other ship or barge employed to carry out drilling or production operations in connection with oil or gas exploration or production, including any accommodation unit moored or positioned on site as an integral part of any such operations, to the extent that such liabilities, costs or expenses arise out of or during drilling or production operations.
For the purpose of this sub-paragraph [(ii)], a ship shall be deemed to be carrying out production operations if (inter alia) it is a storage tanker or other ship engaged in the storage of oil, and either:
a. the oil is transferred directly from a producing well to the storage ship; or
b. the storage ship has oil and gas separation equipment on board and gas is being separated from oil whilst on board the storage ship other than by natural venting.
(iii) Specialist operations
Liabilities, costs and expenses incurred by a Member during the course of performing specialist operations including but not limited to dredging, blasting, pile-driving, well-stimulation, cable or pipelaying, construction, installation or maintenance work, core sampling, depositing of spoil, professional oil spill response or professional oil spill response training and tank cleaning (otherwise than on the entered ship)(but excluding fire-fighting) to the extent that such liabilities, costs and expenses arise as a consequence of:
a. claims brought by any party for whose benefit the work has been performed, or by any third party (whether connected with any party for whose benefit the work has been performed or not), in respect of the specialist nature of the operations; or
b. the failure to perform such specialist operations by the Member or the fitness for purpose or quality of the Member’s work, products or services; or
c. any loss of or damage to the contract work.
PROVIDED ALWAYS that this exclusion shall not apply to liabilities, costs and expenses incurred by a Member in respect of:
a. loss of life, injury or illness of crew and other personnel on board the entered ship; or
b. the wreck removal of the entered ship; or
c. oil pollution emanating from the entered ship or the threat thereof, but only to the extent that such liabilities, costs and expenses are covered by the Association under Rule 3.
(iv) Waste disposal and sub-sea activities
Liabilities, costs and expenses incurred by a Member in connection with any claim arising out of:
a. waste incineration or disposal operations carried out by the entered ship (other than any such operations carried out as an incidental part of other commercial activities, not being specialist operations); or
b. the operation by the Member of submarines, mini-submarines or diving bells; or
c. the activities of professional or commercial divers where the Member is responsible for such activities, other than
(a) activities arising out of salvage operations being conducted by an entered ship where the divers form part of the crew of that entered ship (or of diving bells or other similar equipment or craft operating from the entered ship) and where the Member is responsible for the activities of such divers; and
(b) incidental diving operations carried out in relation to the inspection, repair or maintenance of the entered ship or in relation to damage caused by the entered ship; and
(c) recreational diving activities.
(v) Non-marine personnel
Liabilities, costs and expenses incurred by a Member in respect of:
a. personnel (other than marine crew) on board the entered ship (being used as an accommodation vessel) employed otherwise than by the Member, where there has not been a contractual allocation of risks as between the Member and the employer of the personnel which has been approved by the Managers; or
b. hotel and restaurant guests or other visitors or catering crew of the entered ship when the ship is moored (otherwise than on a temporary basis) and is open to the public as a hotel, restaurant, bar or other place of entertainment.
(vi) Heavy lift
Liabilities, costs and expenses incurred by a Member in respect of loss of or damage to or wreck removal of cargo carried on a semi-submersible heavy lift entered ship or an entered ship which is designed exclusively for the carriage of heavy lift cargo, save where the cargo is carried under a contract on Heavycon terms or any other terms approved in writing by the Managers.
vi. Double insurance
The Association shall not, unless and to the extent that the Directors in their discretion otherwise decide, be liable for any liabilities, costs or expenses recoverable under any other insurance or which would have been so recoverable:
(i) apart from any terms in such other insurance excluding or limiting liability on the ground of double insurance; and
(ii) if the ship had not been entered in the Association with cover against the risks set out in these Rules.
vii. Imprudent Trading
Contraband, blockade running, unlawful trade, imprudent or hazardous operations
No claim shall be recoverable from the Association if it arises out of or is consequent upon an entered ship carrying contraband, blockade running or being employed in an unlawful trade or if the Directors, having regard to all the circumstances, shall be of the opinion that the carriage, trade or voyage was imprudent, unsafe, unduly hazardous or improper.
viii. Paperless trading
There shall be no recovery from the Association in respect of liabilities, losses, costs and expenses arising from the use of any electronic trading system, other than an electronic trading system approved by the Managers in writing, to the extent that such liabilities, losses, costs and expenses would not (save insofar as the Association in its sole discretion otherwise determines) have arisen under a paper trading system.
For the purposes of this paragraph,
i) an electronic trading system is any system which replaces or is intended to replace paper documents used for the sale of goods and/or their carriage by sea or partly by sea and other means of transport and which:
(i) are documents of title, or
(ii) entitle the holder to delivery or possession of the goods referred to in such documents, or
(iii)evidence a contract of carriage under which the rights and obligations of either of the contracting parties may be transferred to a third party.
ii) a “document” shall mean anything in which information of any description is recorded including, but not limited to, computer or other electronically generated information.
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