War Risks Renewals 2006/2007 - TOPIA

CIRCULATED TO ALL WAR CLASS MEMBERS, BROKERS AND DIRECTORS

We hereby give you notice that your Directors have decided in exercise of their powers under Rule 4.D.8.1 to give 7 days notice of cancellation of cover commencing 12 hours GMT 13 February 2006 and that on the expiry of 7 days thereafter, effective from 1200 hours GMT 20 February 2006, cover is reinstated subject to the following additional term of entry.

“TOPIA Exclusion Clause

The Association shall not be liable for any amounts paid in respect of Pollution Damage arising under the Tanker Oil Pollution Indemnification Agreement 2006 [TOPIA] caused by an act of terrorism.”

TOPIA comes into force on 20 February 2006 and will only operate in respect of pollution damage from a tanker in a country that is a signatory to the Civil Liability Convention 1992 [CLC 92].  In practice, because CLC 92 excludes liabilities which result from war, TOPIA, in turn, should not impose a liability on the owner.  However the position under CLC 92 is less clear in respect of terrorist risks and TOPIA specifically includes a provision that no indemnification shall be payable in respect of any act of terrorism unless there is insurance in force for terrorism at the time of the incident.  This endorsement is to confirm that there is no such insurance.

WJM DOUGLAS

MANAGER – North Insurance Management Limited

As Managers on behalf of the North of England P&I Association Limited