INSTITUTE TIME CLAUSES HULLS
PORT RISKS
This insurance is subject to Australian law and practice
1 NAVIGATION
The Vessel has leave to proceed to and from any wet or dry docks harbours ways cradles and pontoons, within the
limits specified in this insurance.
2 TERMINATION
This Clause 2 shall prevail notwithstanding any provision whether written typed or printed in this insurance
inconsistent therewith.
Unless Underwriters agree to the contrary in writing, this insurance shall terminate automatically at the time of
2.1 change of the Classification Society of the Vessel, or change, suspension, discontinuance, withdrawal or
expiry of her Class therein. However where such change, suspension, discontinuance or withdrawal of her
Class has resulted from loss or damage covered by Clause 4 of this insurance or which would be covered
by an insurance of the Vessel subject to current Institute War and Strikes Clauses Hulls-Time such
automatic termination shall not operate.
2.2 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 Vessel. However, in the event of requisition for title
or use without the prior execution of a written agreement by the Assured, such automatic termination
shall occur fifteen days after such requisition whether the Vessel is in port or at sea.
3 ASSIGNMENT
No assignment of or interest in this insurance or in any moneys which may be or become payable thereunder is to
be binding on or recognised by the Underwriters unless a dated notice of such assignment or interest signed by the
Assured, and by the assignor in the case of subsequent assignment, is endorsed on the Policy and the Policy with
such endorsement is produced before payment of any claim or return of premium thereunder.
4 PERILS
4.1 This insurance covers loss of or damage to the subject-matter insured caused by
4.1.1 perils of the seas rivers lakes or other navigable waters
4.1.2 fire lightning explosion
4.1.3 violent theft by persons from outside the Vessel
4.1.4 jettison
4.1.5 piracy
4.1.6 breakdown of or accident to nuclear installations or reactors
4.1.7 contact with aircraft or similar objects, or objects falling therefrom, land conveyance, dock or
harbour equipment or installation.
4.2 This insurance covers loss of or damage to the subject-matter insured caused by
4.2.1 accidents in loading discharging or shifting cargo or fuel
4.2.2 bursting of boilers breakage of shafts or any latent defect in the machinery or hull
4.2.3 negligence of Master Officers Crew or Pilots
4.2.4 negligence of repairers or charterers provided such repairers or charterers are not an Assured
hereunder
4.2.5 barratry of Master Officers or Crew,
provided such loss or damage has not resulted from want of due diligence by the Assured, Owners or
Managers.
4.3 Master Officers Crew or Pilots not to be considered Owners within the meaning of this Clause 4 should
they hold shares in the Vessel.
5 EARTHQUAKE AND VOLCANIC ERUPTION EXCLUSION
In no case shall this insurance cover loss damage liability or expense caused by earthquake or volcanic eruption.
This exclusion applies to all claims including claims under Clauses 7, 9, 11 and 13.
6 POLLUTION HAZARD
This insurance covers loss of or damage to the Vessel caused by any governmental authority acting under the
powers vested in it to prevent or mitigate a pollution hazard, or threat thereof, resulting directly from damage to
the Vessel for which the Underwriters are liable under this insurance, provided such act of governmental authority
has not resulted from want of due diligence by the Assured, the Owners, or Managers of the Vessel or any of them
to prevent or mitigate such hazard or threat. Master, Officers, Crew or Pilots not to be considered Owners within
the meaning of this Clause 6 should they hold shares in the Vessel.
7 COLLISION LIABILITY
7.1 The Underwriters agree to indemnify the Assured for any sum or sums paid by the Assured to any other
person or persons by reason of the Assured becoming legally liable by way of damages for
7.1.1 loss of or damage to any other vessel or property on any other vessel
7.1.2 delay to or loss of use of any such other vessel or property thereon
7.1.3 general average of, salvage of, or salvage under contract of, any such other vessel or property
thereon,
where such payment by the Assured is in consequence of the Vessel hereby insured coming into collision
with any other vessel.
7.2 The indemnity provided by this Clause 7 shall be in addition to the indemnity provided by the other terms
and conditions of this insurance and shall be subject to the following provisions:
7.2.1 where the insured Vessel is in collision with another vessel and both vessels are to blame then, unless
the liability of one or both vessels becomes limited by law, the indemnity under this Clause 7 shall be
calculated on the principle of cross-liabilities as if the respective Owners had been compelled to pay
to each other such proportion of each other's damages as may have been properly allowed in
ascertaining the balance or sum payable by or to the Assured in consequence of the collision.
7.2.2 In no case shall the Underwriters' total liability under Clauses 7.1 and 7.2 exceed their proportionate
part of the insured value of the Vessel hereby insured in respect of any one such collision.
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(Continued)
7.3 The Underwriters will also pay the legal costs incurred by the Assured or which the Assured may be
compelled to pay in contesting liability or taking proceedings to limit liability, with the prior written
consent of the Underwriters.
EXCLUSIONS
7.4 Provided always that this Clause 7 shall in no case extend to any sum which the Assured shall pay for or in
respect of
7.4.1 removal or disposal of obstructions, wrecks, cargoes or any other thing whatsoever
7.4.2 any real or personal property or thing whatsoever except other vessels or property on other vessels
7.4.3 the cargo or other property on, or the engagements of, the insured Vessel
7.4.4 loss of life, personal injury or illness
7.4.5 pollution or contamination of any real or personal property or thing whatsoever (except other
vessels with which the insured Vessel is in collision or property on such other vessels).
8 SISTERSHIP
Should the Vessel hereby insured come into collision with or receive salvage services from another vessel belonging
wholly or in part to the same Owners or under the same management, the Assured shall have the same rights under
this insurance as they would have were the other vessel entirely the property of Owners not interested in the Vessel
hereby insured; but in such cases the liability for the collision or the amount payable for the services rendered shall
be referred to a sole arbitrator to be agreed upon between the Underwriters and the Assured.
9 PROTECTION AND INDEMNITY
9.1 The Underwriters agree to indemnify the Assured for any sum or sums paid by the Assured to any other
person or persons by reason of the Assured becoming legally liable, as owner of the Vessel, for any claim,
demand, damages and/or expenses, where such liability is in consequence of any of the following matters
or things and arises from an accident or occurrence during the period of this insurance:
9.1.1 loss of or damage to any fixed or movable object or property or other thing or interest whatsoever,
other than the Vessel, arising from any cause whatsoever in so far as such loss or damage is not
covered by Clause 7
9.1.2 any attempted or actual raising, removal or destruction of any fixed or movable object or property
or other thing, including the wreck of the Vessel, or any neglect or failure to raise, remove, or
destroy the same
9.1.3 liability assumed by the Assured under contracts of customary towage for the purpose of entering or
leaving port or manoeuvring within the port during the ordinary course of trading
9.1.4 loss of life, personal injury, illness or payments made for life salvage
9.1.5 liability under Clause 1(a) of the current Lloyd's Standard Form of Salvage Agreement in respect of
unsuccessful, partially successful, or uncompleted services if and to the extent that the salvor's
expenses plus the increment exceed any amount otherwise recoverable under the Agreement.
9.2 The Underwriters agree to indemnify the Assured for any of the following arising from an accident or
occurrence during the period of this insurance:
9.2.1 the additional cost of fuel, insurance, wages, stores, provisions and port charges reasonably
incurred solely for the purpose of landing from the Vessel sick or injured persons or stowaways,
refugees, or persons saved at sea
9.2.2 additional expenses brought about by the outbreak of infectious disease on board the Vessel or
ashore
9.2.3 fines imposed on the Vessel, on the Assured, or on any Master Officer crew member or agent of the
Vessel who is reimbursed by the Assured, for any act or neglect or breach of any statute or
regulation relating to the operation of the Vessel, provided that the Underwriters shall not be liable
to indemnify the Assured for any fines which result from any act neglect failure or default of the
Assured their agents or servants other than Master Officer or crew member
9.2.4 the expenses of the removal of the wreck of the Vessel from any place owned, leased or occupied by
the Assured
9.2.5 legal costs incurred by the Assured, or which the Assured may be compelled to pay, in avoiding,
minimising or contesting liability with the prior written consent of the Underwriters.
EXCLUSIONS
9.3 Notwithstanding the provisions of Clauses 9.1 and 9.2 this Clause 9 does not cover any liability cost or
expense arising in respect of:
9.3.1 any direct or indirect payment by the Assured under workmen's compensation or employers' liability
acts and any other statutory or common law, general maritime law or other liability whatsoever in
respect of accidents to or illness of workmen or any other persons employed in any capacity whatsoever
by the Assured or otherwise in on or about or in connection with the Vessel or her cargo, materials or repairs
9.3 2 liability assumed by the Assured under agreement expressed or implied in respect of death or illness
of or injury to any person employed under a contract of service or apprenticeship by the other party
to such agreement
9.3.3 punitive or exemplary damages, however described
9.3.4 cargo or other property carried, to be carried or which has been carried on board the Vessel but this
Clause 9.3.4 shall not exclude any claim in respect of the extra cost of removing cargo from the
wreck of the Vessel
9.3.5 property, owned by builders or repairers or for which they are responsible, which is on board the
Vessel
9.3.6 liability arising under a contract or indemnity in respect of containers, equipment, fuel or other
property on board the Vessel and which is owned or leased by the Assured
9.3.7 cash, negotiable instruments, precious metals or stones, valuables or objects of a rare or precious
nature, belonging to persons on board the Vessel, or non-essential personal effects of any Master,
Officer or crew member
9.3.8 fuel, insurance, wages, stores, provisions and port charges arising from delay to the Vessel while
awaiting a substitute for any Master, Officer or crew member
9.3.9 fines or penalties arising from overloading or illegal fishing
9.3.10 pollution or contamination of any real or personal property or thing whatsoever (This Clause 9.3.10
shall not exclude any amount recoverable under Clause 9.1.5)
9.3.11 general average, sue and labour and salvage charges, salvage, and/or collision liability to any extent
that they are not recoverable under Clauses 7, 11 and 13 by reason of the agreed value and/or the
amount insured in respect of the Vessel being inadequate.
(Continued)
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9.4 The indemnity provided by this Clause 9 shall be in addition to the indemnity provided by the other terms
and conditions of this insurance.
9.5 Where the Assured or the Underwriters may or could have limited their liability the indemnity under this
Clause 9 in respect of such liability shall not exceed Underwriters' proportionate part of the amount of
such limitation.
9.6 In no case shall the Underwriters' liability under this Clause 9 in respect of each separate accident or
occurrence or series of accidents arising out of the same event, exceed their proportionate part of the
insured value of the Vessel.
9.7 PROVIDED ALWAYS THAT
9.7.1 prompt notice must be given to the Underwriters of every casualty event or claim upon the Assured
which may give rise to a claim under this Clause 9 and of every event or matter which may cause
the Assured to incur liability costs or expense for which he may be insured under this Clause 9.
9.7.2 the Assured shall not admit liability for or settle any claim for which he may be insured under this
Clause 9 without the prior written consent of the Underwriters.
10 NOTICE OF CLAIM AND TENDERS
10.1 In the event of accident whereby loss or damage may result in a claim under this insurance, notice shall be
given to the Underwriters prior to survey and also, if the Vessel is abroad, to the nearest Lloyd's Agent so
that a surveyor may be appointed to represent the Underwriters should they so desire.
10.2 The Underwriters shall be entitled to decide the port to which the Vessel shall proceed for docking or
repair (the actual additional expense of the voyage arising from compliance with the Underwriters'
requirements being refunded to the Assured) and shall have a right of veto concerning a place of repair or
a repairing firm.
10.3 The Underwriters may also take tenders or may require further tenders to be taken for the repair of the
Vessel. Where such a tender has been taken and a tender is accepted with the approval of the
Underwriters, an allowance shall be made at the rate of 30% per annum on the insured value for time lost
between the despatch of the invitations to tender required by Underwriters and the acceptance of a tender
to the extent that such time is lost solely as the result of tenders having been taken and provided that the
tender is accepted without delay after receipt of the Underwriters' approval.
Due credit shall be given against the allowance as above for any amounts recovered in respect of fuel and
stores and wages and maintenance of the Master Officers and Crew or any member thereof, including
amounts allowed in general average, and for any amounts recovered from third parties in respect of
damages for detention and/or loss of profit and/or running expenses, for the period covered by the
tender allowance or any part thereof.
Where a part of the cost of the repair of damage other than a fixed deductible is not recoverable from the
Underwriters the allowance shall be reduced by a similar proportion.
10.4 In the event of failure to comply with the conditions of this Clause 10, a deduction of 15% shall be made
from the amount of the ascertained claim.
11 GENERAL AVERAGE AND SALVAGE
11.1 This insurance covers the Vessel's proportion of salvage, salvage charges and/or general average, reduced
in respect of any under-insurance, but in case of general average sacrifice of the Vessel the Assured may
recover in respect of the whole loss without first enforcing their right of contribution from other parties.
11.2 Adjustment to be according to the law and practice obtaining at the place where the adventure ends, as if
the contract of affreightment contained no special terms upon the subject; but where the contract of
affreightment so provides the adjustment shall be according to the York-Antwerp Rules.
11.3 No claim under this Clause 11 shall in any case be allowed where the loss was not incurred to avoid or in
connection with the avoidance of a peril insured against.
12 DEDUCTIBLE
12.1 No claim arising from a peril insured against shall be payable under this insurance unless the aggregate of
all such claims arising out of each separate accident or occurrence (including claims under Clauses 7, 9, 11
and 13) exceeds........................................................................................... in which case this sum shall be
deducted. Nevertheless the expense of sighting the bottom after stranding, if reasonably incurred
specially for that purpose, shall be paid even if no damage be found. This Clause 12.1 shall not apply to a
claim for total or constructive total loss of the Vessel or, in the event of such a claim, to any associated
claim under Clause 13 arising from the same accident or occurrence.
12.2 Excluding any interest comprised therein, recoveries against any claim which is subject to the above
deductible shall be credited to the Underwriters in full to the extent of the sum by which the aggregate of
the claim unreduced by any recoveries exceeds the above deductible.
12.3 Interest comprised in recoveries shall be apportioned between the Assured and the Underwriters, taking
into account the sums paid by the Underwriters and the dates when such payments were made
notwithstanding that by the addition of interest the Underwriters may receive a larger sum than they have
paid.
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(Continued)
13 DUTY OF ASSURED (SUE AND LABOUR)
13.1 In case of any loss or misfortune it is the duty of the Assured and their servants and agents to take such
measures as may be reasonable for the purpose of averting or minimising a loss which would be
recoverable under this insurance.
13.2 Subject to the provisions below and to Clause 12 the Underwriters will contribute to charges properly and
reasonably incurred by the Assured their servants or agents for such measures. General average, salvage
charges (except as provided for in Clause 13.5) collision defence or attack costs and costs incurred by the
Assured in avoiding, minimising or contesting liability covered by Clause 9 are not recoverable under this
Clause 13.
13.3 Measures taken by the Assured or the Underwriters with the object of saving, protecting or recovering the
subject-matter insured shall not be considered as a waiver or acceptance of abandonment or otherwise
prejudice the rights of either party.
13.4 When expenses are incurred pursuant to this Clause 13 the liability under this insurance shall not exceed
the proportion of such expenses that the amount insured hereunder bears to the value of the Vessel as
stated herein, or to the sound value of the Vessel at the time of the occurrence giving rise to the
expenditure if the sound value exceeds that value. Where the Underwriters have admitted a claim for total
loss and property insured by this insurance is saved, the foregoing provisions shall not apply unless the
expenses of suing and labouring exceed the value of such property saved and then shall apply only to the
amount of the expenses which is in excess of such value.
13.5 When a claim for total loss of the Vessel is admitted under this insurance and expenses have been
reasonably incurred in saving or attempting to save the Vessel and other property and there are no
proceeds, or the expenses exceed the proceeds, then this insurance shall bear its pro rata share of such
proportion of the expenses, or of the expenses in excess of the proceeds, as the case may be, as may
reasonably be regarded as having been incurred in respect of the Vessel; but if the Vessel be insured for
less than its sound value at the time of the occurrence giving rise to the expenditure, the amount
recoverable under this clause shall be reduced in proportion to the under-insurance.
13.6 The sum recoverable under this Clause 13 shall be in addition to the loss otherwise recoverable under this
insurance but shall in no circumstances exceed the amount insured under this insurance in respect of the
Vessel.
14 NEW FOR OLD
Claims payable without deduction new for old.
15 BOTTOM TREATMENT
In no case shall a claim be allowed in respect of scraping gritblasting and/or other surface preparation or painting
of the Vessel's bottom except that
15.1 gritblasting and/or other surface preparation of new bottom plates ashore and supplying and applying
any "shop" primer thereto,
15.2 gritblasting and/or other surface preparation of:
the butts or area of plating immediately adjacent to any renewed or refitted plating damaged during the
course of welding and/or repairs,
areas of plating damaged during the course of fairing, either in place or ashore,
15.3 supplying and applying the first coat of primer/anti-corrosive to those particular areas mentioned in 15.1
and 15.2 above,
shall be allowed as part of the reasonable cost of repairs in respect of bottom plating damaged by an insured peril.
16 WAGES AND MAINTENANCE
No claim shall be allowed, other than in general average, for wages and maintenance of the Master, Officers and
Crew, or any member thereof, except when incurred solely for the necessary removal of the Vessel, with the
agreement of the Underwriters, from one port to another for the repair of damage covered by the Underwriters, or
for trial trips for such repairs, and then only for such wages and maintenance as are incurred whilst the Vessel is
under way.
17 AGENCY COMMISSION
In no case shall any sum be allowed under this insurance either by way of remuneration of the Assured for time
and trouble taken to obtain and supply information or documents or in respect of the commission or charges of
any manager, agent, managing or agency company or the like, appointed by or on behalf of the Assured to
perform such services.
18 UNREPAIRED DAMAGE
18.1 The measure of indemnity in respect of claims for unrepaired damage shall be the reasonable depreciation
in the market value of the Vessel at the time this insurance terminates arising from such unrepaired
damage, but not exceeding the reasonable cost of repairs.
18.2 In no case shall the Underwriters be liable for unrepaired damage in the event of a subsequent total loss
(whether or not covered under this insurance) sustained during the period covered by this insurance or
any extension thereof.
18.3 The Underwriters shall not be liable in respect of unrepaired damage for more than the insured value at
the time this insurance terminates.
19 CONSTRUCTIVE TOTAL LOSS
19.1 In ascertaining whether the Vessel is a constructive total loss, the insured value shall be taken as the
repaired value and nothing in respect of the damaged or break-up value of the Vessel or wreck shall be
taken into account.
19.2 No claim for constructive total loss based upon the cost of recovery and/or repair of the Vessel shall be
recoverable hereunder unless such cost would exceed the insured value. In making this determination only
the cost relating to a single accident or sequence of damages arising from the same accident shall be taken
into account.
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(Continued)
20 DISBURSEMENTS WARRANTY
20.1 Additional insurances as follows are permitted:
20.1.1 Disbursements, Managers' Commissions, Profits or Excess or Increased Value of Hull and
Machinery. A sum not exceeding 25% of the value stated herein.
20.1.2 Earnings or Anticipated Freight, insured for time. A sum not exceeding 25% of the value as stated
herein less any sum insured, however described, under 20.1.1.
20.1.3 Freight or Hire, under contracts for voyage. A sum not exceeding the gross freight or hire for the
first passage and next succeeding cargo passage plus the charges of insurance. In the case of a
voyage charter where payment is made on a time basis, the sum permitted for insurance shall be
calculated on the estimated duration of the voyage, subject to the limitation of two cargo passages
as laid down herein. Any sum insured under 20.1.2 to be taken into account and only the excess
thereof may be insured.
20.1.4 Time Charter Hire or Charter Hire for Series of Voyages. A sum not exceeding 50% of the gross
hire which is to be earned under the charter in a period not exceeding 18 months. Any sum insured
under 20.1.2 to be taken into account and only the excess thereof may be insured. An insurance
under this Section may begin on the signing of the charter.
20.1.5 Premiums. A sum not exceeding the actual premiums of all interests insured for a period not
exceeding 12 months (excluding premiums insured under the foregoing sections but including, if
required, the premium or estimated calls on any Club or War etc. Risk insurance) reducing pro rata
monthly.
20.1.6 Returns of Premium. A sum not exceeding the actual returns which are allowable under any
insurance but which would not be recoverable thereunder in the event of a total loss of the Vessel
whether by insured perils or otherwise.
20.1.7 Insurance irrespective of amount against:
Any risks excluded by Clauses 5, 22, 23, 24 and 25.
20.2 Warranted that no insurance on any interests enumerated in the foregoing 20.1.1 to 20.1.6 in excess of the
amounts permitted therein and no other insurance which includes total loss of the Vessel P.P.I., F.I.A.,
or subject to any other like term, is or shall be effected to operate during the currency of this insurance by
or for account of the Assured, Owners, Managers or Mortgagees. Provided always that a breach of this
warranty shall not afford the Underwriters any defence to a claim by a Mortgagee who has accepted this
insurance without knowledge of such breach.
21 RETURNS FOR CANCELLATION
To return pro rata monthly net for each uncommenced month if this insurance be cancelled either by agreement or
by the operation of Clause 2 provided that a total loss of the Vessel, whether by insured perils or otherwise, has
not occurred during the period of this insurance or any extension thereof.
The following clauses shall be paramount and shall override anything contained in this insurance inconsistent
therewith.
22 WAR EXCLUSION
In no case shall this insurance cover loss damage liability or expense caused by
22.1 war civil war revolution rebellion insurrection, or civil strife arising therefrom, or any hostile act by or
against a belligerent power
22.2 capture seizure arrest restraint or detainment (barratry and piracy excepted), and the consequences
thereof or any attempt thereat
22.3 derelict mines torpedoes bombs or other derelict weapons of war.
23 STRIKES EXCLUSION
In no case shall this insurance cover loss damage liability or expense caused by
23.1 strikers, locked-out workmen, or persons taking part in labour disturbances, riots or civil commotions
23.2 any terrorist or any person acting from a political motive.
24 MALICIOUS ACTS EXCLUSION
In no case shall this insurance cover loss damage liability or expense arising from
24.1 the detonation of an explosive
24.2 any weapon of war
and caused by any person acting maliciously or from a political motive.
25 NUCLEAR EXCLUSION
In no case shall this insurance cover loss damage liability or expense arising from any weapon of war employing
atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter.
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