Clause 19 - Cancellation of Insurance and its Effects

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Clause 19 - Cancellation of Insurance and its Effects

A.     Where an Assured has failed to pay premium, either in whole or in part, or any other amount due from it to the Club, the Managers may give it notice in writing requiring it to pay such amount by any date specified in such notice, not being less than seven days from the date on which such notice is given. Further:

(i)     Unless the Club otherwise decides, an Assured shall not be entitled to recover from the Club any liabilities, cost and expenses in respect of any claim arising from the date of such failure until the date such sum owing to the Club is paid in full;

(ii)    If the Assured fails to make such a payment in full on or before the date so specified, the insurance of the Assured in respect of any and all ships referred to in such notice and entered in the Club by it or on its behalf shall be cancelled forthwith without further notice or other formality.

B. When the insurance of an Assured is cancelled in accordance with paragraph (A) of this Clause (which time is hereinafter in this Clause 19 referred to as “the date of cancellation”) then:

 i.       such Assured and its successors shall be and remain liable in relation to premium and other sums payable:

a)     in respect of the policy year in which the date of cancellation falls, on a pro rata basis, namely for the proportion of such sums applicable to the period beginning at the date of entry specified in the certificate of entry and ending on the date of cancellation or such earlier date as the Managers in their discretion decide and agree in writing, and

b)     in respect of previous policy years, for the whole of those policy years, and

ii.      The Club shall with effect from the date of cancellation cease to be liable for any claims of whatsoever kind under these Terms & Conditions in respect of any and all ships in relation to which the insurance of the Assured has been cancelled,

a)     irrespective whether such claims have occurred or arisen or may arise by reason of any event which has occurred at any time prior to the date of cancellation, including during previous years;

b)     irrespective whether such claims arise by reason of any event occurring after the date of cancellation;

c)      irrespective whether the Club may have admitted liability for or appointed lawyers, surveyors or any other person to deal with such claims;

d)     irrespective whether the Club at the date of or prior to the date of cancellation knew that such claims might or would arise, and as from the date of cancellation any liability of the Club for such claims shall terminate retrospectively and the Club shall be under no liability to such Assured for any such claims or on any account whatsoever.


The Club may in its discretion and upon such terms as it thinks fit, including but not restricted to terms as to payment of premium or other sums, admit either in whole or in part any claim in respect of any ship entered by an Assured for which the Club is under no liability by virtue of paragraphs (A) or (B) of this Clause, whether such claim has arisen before or arises after the date of cessation or the date of cancellation as the case may be, or remit wholly or partly any payment of contribution, premiums or other sums due to the Club.