As described in our circular No.23-013 dated 20 November 2023, the following alterations to the Rules of the Association (the "Rules") will become effective from 12 noon GMT on 20 February 2024 for the 2024 policy year. There will also be an alteration to the Special Clause. The amendments are explained below, and extracts of the relevant provisions are attached hereto.

1. Alterations to the Rules

Rule 1(CONCLUSION OF INSURANCE CONTRACT) 10 (2)
Rule 11 (CESSATION OF INSURANCE CONTRACT) 3 (3)
The amendments are to unify the wording and add examples for the provisions related to sanctions, including those in the United Kingdom.

Rule 17 (WARRANTY OF SEAWORTHINESS) 1, 2, 3 and 4
Rule 17 pertains to surveys regarding the conditions of ships already entered in the Association and intended to be insured by the Association.

Rule 17.1 pertains to surveys, specifically Condition Surveys for ships already entered in the Association. The amendments enable the cancellation of insurance, as well as refusal of the payment of claims, or a reduction in the amount payable, if the Member has failed to comply with any recommendations as to the repair made by the surveyor. This aims to further improve the quality of our entered ships.

The amendments to Rule 17.2 clarify that the Association shall not be liable to indemnify the Member in respect of any loss, damage or expenses incurred after any recommendations as to repair have been made by the surveyor.

Rule 17.4 pertains to the inspection, also known as the Entry Survey, of a ship for which is intended to be insured by the Association. The amendments clarify that the Association may reject the entry of the ship or accept of entry of the ship with certain conditions, if any requirements referred to Rule 17.1 and 2 are not satisfied.

Rule 19 (LIABILITIES IN RESPECT OF SEAMEN) 1 (3) (LOSS OF/OR DAMAGE TO SEAMEN’S PERSONAL EFFECTS)
The amendments clarify that the loss of or damage to a seaman’s personal effects that are not essential to life on board, such as valuables and toys, is not covered.

Rule 19 (LIABILITIES IN RESPECT OF SEAMEN) 2 (1)
In some countries, including Japan, it is required by law to cover the scope of disaster compensation stipulated by law. Seafarers’ insurance is compulsory in Japan. This provision was originally established to clarify that the Association does not cover the areas that overlap with compulsory insurance, such as seafarers' insurance. However, in some countries, compulsory insurance is not functioning in reality even when it is legally required. The amendments enable the Association to cover such cases, subject to the Association’s approval.

Rule 29 (CARGO LIABILITIES) 1 (5)
The amendments clarify the period during which costs would normally be incurred to retain cargo, aiming to prevent cargo from being left unattended for an extended period without notifying the Association when the receivers have not collected the cargo, which can result in high storage costs.

Rule 35 (RISKS GENERALLY EXCLUDED) 1 (13)
The amendments are in line with the amendment to the Pooling Agreement.

Rule 36 (RISKS SPECIFICALLY EXCLUDED) (10)
The amendments clarify that there will be no recovery from the Association in cases where providing cover could pose a risk of sanctions or other measures being imposed on the Association.

2. Alteration to the Special Clauses

P&I WAR RISKS CLAUSE 3 (2) 1), 2), and 3)
The amendments are in line with the amendment to the Pooling Agreement.

SPECIAL CLAUSE FOR PAYMENT OF CALLS OR PREMIUMS BY A GOVERNMENT-AFFILIATED CORPORATION 1 (1)
The wording has been made consistent.

A Rule Book for the 2024 Policy Year is scheduled to be posted on our website in the middle of February 2024.