Section 7 Nuclear risks

11.7.1 General

The insurance industry appreciates the potential aggregate of liabilities that may be incurred in the event of a single nuclear accident. Similar casualties could occur in shipping involving several vessels and large areas in and outside harbour installations. The liability effects of such an accident could exceed the capacity of marine insurance cover available. Nuclear risks are therefore excluded in essentially the same way in most marine insurance and reinsurance contracts.

11.7.2 Exclusion of paramount importance

The last paragraph of the provision is paramount. It states that the exclusion of liability risks under this clause overrides any conditions that may be contained in these Rules or any policies or documents issued thereunder if such conditions are inconsistent with the contents of the provision.

11.7.3 Nuclear powered ships

The exclusions under (a) – (b) mean that nuclear risks arising from the fuel of a nuclear- powered entered ship are excluded. In this respect the clause serves as a completion of Rule 11 Section 3 in respect of that type of ship. The policy issued for a nuclear- powered ship will usually reflect the limited extent of the cover. If not, the cover is still subject to the liability exclusions of this provision due to its paramount nature.

11.7.4 Collision

Items (a) – (b) of the provision exclude liability for nuclear risks arising out of a collision between the entered ship and another vessel carrying nuclear material as fuel or cargo.

11.7.5 Nuclear weapons

Liabilities arising from nuclear weapons are excluded under item I.

11.7.6 Nuclear cargo

11.7.6.1 Nuclear cargo exclusions

The effect of this provision is that liability for carriage of nuclear products under (a) – (d) as cargo is generally excluded.

11.7.6.2 Nuclear cargo the carriage of which may be approved

Shipments which can be covered are radioactive products and nuclear substances with a low level of radioactivity. The products and substances concerned consist of radioisotopes used or intended to be used for industrial, commercial, agricultural, medical and scientific purposes. They include natural and depleted uranium.

The products for which carriage may be approved are further defined in Section 26 (1) of the U.K. Nuclear Installations Act of 1965 or any subsequent amendments. The reason why reference is made to U.K. legislation is that it contains the definition of radioactive products and substances, the carriage of which has been authorised by the Club’s reinsurers. It is important for the Club and its Members that the clause mirrors the extent of reinsurance protection available for such large and serious risks.

As a result of the above the Group Clubs have agreed that whenever a request is made by a Member or a Charterer regarding the carriage of nuclear cargo the Member shall refer the specification of such nuclear cargo to the Club who in turn will refer it to a specialist who will check that the cargo in question qualifies as “excepted matter” in accordance with the Act of 1965.

A further condition of cover is that the radioactive products or substances are carried as cargo. This means that the carriage should be performed on standard terms of contracts or agreements as defined in Rule 10 Section 2. The reason is that such contracts should contain all legal exclusions from and limitations of liability available.