Rule 11 Exclusions
Section 1 Member’s intent or gross negligence
The Association shall not be liable for liabilities, costs or expenses caused by the intentional or grossly negligent acts or omissions of the Member nor for such acts or omissions which the Member knew or ought to have known would cause liabilities, costs or expenses.
Section 2 General exclusions
The Association shall not be liable for
(a) costs or expenses incurred for the normal fulfilment of a transport obligation,
(b) costs or expenses incurred to make the ship fit to receive cargo,
(c) costs or expenses incurred to discharge, reload, restow, store or tranship cargo or other similar measures caused by overloading, bad trim or incorrect stowage of the ship,
(d) liability in relation to specie, bullion and precious metals or stones, plate or other objects of a rare or precious nature, cash, bank notes or other forms of currency, bonds or other negotiable instruments unless the carriage thereof has been approved by the Association,
(e) liabilities, costs and expenses arising out of salvage or wreck removal operations conducted by the entered ship except for the purpose of saving or attempting to save life at sea,
(g) loss of or damage to containers or similar articles of transportation owned, borrowed, leased or bought under reservation of title by the Member,
(h) liabilities, costs or expenses arising out of the failure to arrive or late arrival of the entered ship at the port or place of loading or the failure to load any particular cargo in the entered ship,
(i) liabilities, costs or expenses arising out of intentional discharge of cargo at a port or place other than that stipulated in the contract of carriage,
(j) the Member’s loss of time, freight or other revenue or Member’s liability towards a charterer to pay such loss, extra fuel consumption, port charges or other similar expenses which would have been his own operational costs save for the Charter,
(k) liabilities, costs or expenses arising out of the entered ship carrying contraband or being employed in blockade running or in an unlawful trade or in a trade which under the circumstances is imprudent, unsafe, unduly hazardous or improper,
(l) loss of or damage to the entered ship or any part thereof, its equipment, accessories, spare parts, stores or supplies whether owned by the Member or not, save for liabilities in respect of bunkers belonging to a charterer,
(m) loss arising out of irrecoverable debts or out of the insolvency of any person.
Section 3 Exclusions for certain operations
The cover afforded by the Association shall exclude liabilities, costs or expenses arising out of
(a) salvage operations, including wreck removal, performed by the Member unless incurred for the purpose of saving or attempting to save life at sea or incurred by a professional salvor and the Association has agreed in advance to afford cover for such operation,
(b) drilling or production operations in connection with oil or gas exploration or production,
(c) specialist operations, meaning blasting, pile-driving, well-intervention, cable or pipelaying, construction, installation or maintenance work, core sampling, depositing of soil, power generation and decommissioning to the extent the liabilities, costs and expenses arise as a consequence of
(i) claims which are brought by a party for whose benefit the work has been performed, or by a third party in respect of the specialist nature of the operation; or
(ii) 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
(iii) any loss of or damage to the contract work save for loss of life, injury or illness of crew and another personnel onboard the entered ship, the wreck removal of the entered ship, and oil pollution from the entered ship, or the threat thereof, to the extent such liability is covered by these Rules,
(d) disposal operations unless carried out as an incidental part of other commercial activities not being a specialist operation mentioned above,
(e) the operation by the Member of submarines, mini-submarines and diving bells and activities of professional or commercial divers where the Member is responsible for such activities save for
(i) activities arising out of salvage operations
(ii) incidental diving operations carried out in relation to the inspection, repair or maintenance of the entered ship; and
(iii) recreational diving activities
(f) loss of or damage to or wreck removal of cargo carried on a semi-submersible heavy lift ship or any other ship designed exclusively for the carriage of heavy lift cargo, save to the extent that such cargo is being carried under the terms of a contract on Heavycon terms or any other terms approved by the Association,
(g) in respect of non-marine personnel employed otherwise than by the Member where the ship operates as an accommodation unit unless there has been a contractual allocation of risk between the Member and the employer of the personnel and the contract includes a knock for knock agreement which has been approved by the Association,
(h) hotel and restaurant guests, other visitors, and catering crew where the ship is moored, otherwise than on a temporary basis, and is open to the public as a hotel, restaurant, bar, and/or other place of entertainment.
Section 4 Sanctions
The Association shall not be liable for liabilities, costs or expenses
(a) where the reimbursement or any payment in respect thereof would expose the Association to the risk of being or becoming subject to any sanction, prohibition or adverse action under United Nations Resolutions or the trade or economic sanctions, laws or regulations of the European Union, United Kingdom, United States of America or another significant state power,
(b) in respect of that part of any liabilities, costs and expenses which is not recovered by the Association under the Pooling Agreement, Group Excess Loss Policies or any other reinsurance arranged by the Association because of a shortfall in recovery from such parties or reinsurers thereunder by reason of a sanction, prohibition or adverse action against them under United Nations Resolutions or the trade or economic sanctions, laws or regulations of the European Union, United Kingdom, United States of America or another significant state power or the risk thereof if payment were to be made by such parties or reinsurers. For the purposes of this Rule “shortfall” includes any failure or delay in recovery by the Association by reason of such parties or reinsurers making payment into a designated account in compliance with the requirements of United Nations Resolutions or the trade or economic sanctions, laws or regulations of the European Union, United Kingdom, United States of America or another significant state power. The provisions of this Rule shall cease to apply in respect of any shortfall to the extent the same is subsequently recovered by the Association under the Pooling Agreement, Group Excess Loss Policies or any other reinsurance arranged by the Association.
Section 5 War risks
There shall be no recovery from the Association for liabilities, costs or expenses arising from loss, damage, injury, illness, death or other accidents caused by
(a) 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 (provided that, in the event of any dispute as to whether or not, for the purpose of this paragraph (a) an act constitutes an act of terrorism, the Association shall in its absolute discretion determine that dispute and the Association’s decision shall be final),
(b) capture, seizure, arrest, restraint or detainment – barratry and piracy excepted – and the consequences thereof or any attempt thereat,
(c) 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, whether as a result either of government order or with the agreement of the Association where the reason for such use is avoidance or mitigation of liabilities, costs or expenses which would otherwise fall within the cover given by the Association.
The above conditions shall apply irrespective of whether a contributory cause of the liability arising or the costs or expenses being incurred, is any negligence on the part of the Member, his servants or agents.
Section 6 Other insurance
The Association shall not be liable for liabilities, costs or expenses which would have been covered under the Hull insurance if the entered ship had been fully insured under Hull insurance conditions approved by the Association for a sum which at any time should be the market value without commitment.
The Association shall not be liable for liabilities, costs or expenses in respect of the entered ship, its cargo, passengers carried, members of the crew or other persons performing work in the service of the ship which are recoverable under any other insurance.
The Association shall not be liable for any franchise, deductible or deductions of a similar nature borne by the Member under any other insurance.
Section 7 Nuclear risks
The cover afforded by the Association shall exclude liabilities, costs or expenses directly or indirectly caused by or contributed to by or arising from
(a) ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the combustion of nuclear fuel,
(b) the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other nuclear assembly or nuclear component thereof,
(c) any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter,
(d) the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter.
However, the Association may cover liabilities, costs or expenses arising out of the carriage of “excepted matter” as defined in Section 26 (1) of the Nuclear Installations Act 1965 of the United Kingdom, or any amendments thereof, provided that it is carried as cargo and that the carriage has been approved by the Association. “Excepted matter” consists of radioisotopes which are used or intended to be used for industrial, commercial, agricultural, medical or scientific purpose, natural uranium and depleted uranium.
This clause shall override anything contained in these Rules inconsistent therewith.