British Marine will make the following changes to the 2021 Terms and Conditions which will take effect from 1 January 2021:
Clause 3. Flag State
The clause is amended to read as follows:
It is a condition precedent to liability under this policy that at the time of inception of the Policy and throughout the duration of the policy period the Assured and the Insured vessel is compliant with all requirements of the insured Vessel's flag state including but not limited to :
3.1 the construction, condition, manning and equipping of the insured vessel,
3.2 the maintenance of valid statutory certificates issued by or on behalf of the insured Vessel's flag state; and
3.3 the implementation and maintenance of any vessel(s) or office systems in accordance with flag state requirements.
Reason:
The amendment of this clause provides that the requirement for compliance with flag state regulations is consistent throughout all products offered by British Marine.
Clause 13. Termination of Cover in respect of an insured Vessel.
The notice of termination requirement included in 13.2 is amended. The revised clause is as follows:
13.2 Cover in respect of an Insured Vessel shall cease by the Insurer giving to the Assured notice in Writing following the first inspection of the Insured Vessel by a surveyor or surveyors appointed on behalf of the Insurer pursuant to Clause 4 above. The Insurer shall be under no obligation to state the grounds for such termination of cover. Should the Insured Vessel, at the date the notice of termination of cover is provided in accordance with Clause 4 above be at sea or in port and in distress, the Insured Vessel shall, be held covered until arrival at the next port in safety or, if in port and in distress, until the Insured Vessel is made safe, at a pro-rata per Day premium.
Reason:
The amendment of the notice requirement brings clause 13 in line with Clause 6 Remedies for breach of Clauses 3 (Flag State), 4 (Survey by Insurer) and 5 (ISM Code) specifically 4 (Survey by Insurer).
Clause 14. Premium
The clause is amended to replace "LIBOR" with SONIA. The revised clause is as follows:
Premium payable in respect of this policy shall be paid on such terms as the Insurer shall agree in writing.
In the event of failure by the Assured to pay premium or any instalment of premium due pursuant to the said terms, the Insurer may:
14.1 cancel this policy giving a minimum notice period of seven days.
14.2 vary or restrict the terms on which cover under this policy is provided. In the event of the cancellation of this policy by the Insurer under this Clause, the Insurer shall not be liable in respect of any claims whatsoever, whether arising before or after such cancellation.
The Insurer shall be entitled to interest at a rate of 2% over the SONIA rate for any premium or part of the premium which is due and unpaid for the period over which such premium remains due and unpaid.
Where the Assured has paid the premium due under the Policy and:
14.3 termination of the Policy takes effect pursuant to Clause 13, premium under the Policy shall be returned to the Assured on a pro rata Day basis or may be otherwise agreed by the Insurers in Writing prior to commencement of the Policy period; and
14.4 termination of cover in respect of an Insured Vessel takes effect pursuant to this Clause 14, premium paid in respect of that Insured Vessel shall be returned to the Assured on a percentage of a pro rata per Day basis should the vessel be laid up for a minimum period of thirty[30] consecutive Days and for each completed thirty [30]-Day-period thereafter only if agreed by the insurers in Writing prior to the commencement of the Policy period. For the Insured Vessel to be deemed laid up under the terms of this clause it will need to be:
14.4.1 at a safe port or berth approved by the Insurer upon or before lay up;
14.4.2 without a crew on board except for security and maintenance; and
14.4.3 without cargo onboard.
Reason:
The interest rate benchmark LIBOR is expected to cease towards the end of 2021. The Bank of England's Working Group on Sterling Risk -Free Reference Rates (RFR Working Group) has recommended the Sterling Overnight Index Average (SONIA) benchmark as its preferred near Risk Free Rate (RFR).