As part of our continual effort to monitor and stay ahead of the ever-changing marine industry, WQIS extensively reviews its existing policy form, studies current market coverage and thoroughly examines recent case law. As a result of our most recent findings, we are very pleased to announce the new WQIS Worldwide Vessel Pollution Policy Form 2011 for new and renewal business on or after June 1, 2011.
The old WQIS Policy Form 2007 will be optional until September 1, 2011 at which time we will switch over to the 2011 Form. The old form, subject to certain amended conditions, may be negotiated with your underwriter after the August 31st date.
The purpose of the update, which has been in progress for nearly two years, is to enhance coverage where gaps existed, improve organization, provide simplification, enhance competitive position and adjust to recent legal decisions.
“This new policy form represents the current state of the marine industry but more importantly, it really sets up our assureds for the future,” says Richard Hobbie, President of WQIS. “At WQIS we’ve always prided ourselves on being in touch not only with what’s going on today, but also what’s coming up. And this new form accomplishes that in a very effective way.”
In this new policy form there are numerous changes. Details of the most significant modifications are listed below.
1. All reference to the subsections of the 5 PARTS of the policy are now referred to as “Sections”.
2. All Sections now have titles which are for descriptive purposes only. PART IV Section J specifies “The headings, captions and labels in this Policy are there for the purpose of organization and are not to be used in interpreting the terms, conditions, limit of liability, warranties, exclusions, endorsements and definitions of this Policy.”.
3. The Policy is now worldwide, there is no trading warranty. We will be requiring the Assured declare to us their trading limits but the policy will stand as a worldwide coverage. Please note that this new policy will continue to be subject to the Terrorism Insurance Coverage and U.S. Economic and Trade Sanction Clauses.
PART I- INSURING PROVISIONS
Section A- Discharges, Releases or the Substantial Threat of a Discharge or Release
The old coverage A,B, E, F, H, J and L, covering liabilities for various types of spills, are now combined into a new comprehensive Section A addressing all covered occurrences.
Section B- Investigation and Defense
1. The old Coverage C provided investigation and defense for Oil and Hazardous Substances occurrences. The new Section B provides investigation and defense for all Sections except Section C (U.S. Fines and Penalties) and Section H (Criminal) where defense is provided separately.
2. WQIS will now have the right but not the obligation to name Counsel.
Section C- U.S. Fines and Penalties
1. Administrative fines and the penalties that were covered under the old “Defense Fines and Penalties Endorsement “are now combined into this Section.
2. The Vessel General Permit (VGP) Policy that was provided separately is now incorporated into this Section and is a standard coverage.
Section D- Additional Public Relations
Public Relations had 40% coinsurance and that has been reduced to 20%. (i.e. we increased cover to 80% rather than the old 60%)
Section E- Automatic Acquisition Clause
Section F- Mitigation
Mitigation of all policy coverage now falls under this Section.
Section G- Property Damage Ashore
This is a new Section that provides coverage for discharges into the air which causes property damage ashore. This coverage was excluded under the AIMU Pollution Exclusion and Buy back clause (both existing and proposed) and this coverage is being affirmatively expressed in the policy. Please note that property does not include cargo!
Section H- U.S. Criminal Defense
The existing “Limited Fines and Penalties” endorsement is now being included in the new Section C . The old coverage was badly understood. This new Section H has been added to make it absolutely clear what and how much criminal defense is being offered. This new Section has a sub-limit and an annual aggregate. Also criminal defense requires our prior written consent unless it is limited to $5,000.
PART II- LIMIT OF LIABILITY
We are maintaining the each vessel, each occurrence limits that we have been offering, however the investigation and defense costs are included within the limit.
This allows coverage that previously had a sub-limit to have an increased limit, subject always to the occurrence limit. There are sub-limits only for Fines and Penalties and for Criminal Defense. This allows clean and clear delineation of underlying limits for purposes of scheduling underlying
PART III- POLICY EXCLUSIONS
There are numerous small changes to individual exclusions to better reflect intent and meaning. There are no new exclusions except the exclusions for the Vessel General Permit coverage, however they are the same exclusions that were contained in the VGP Policy.
PART IV- GENERAL TERMS, CONDITIONS AND LIMITATIONS
1. Section J- Headings, Captions and Labels: This section was added to simply confirm that headings, captions and labels are not to be used when interpreting the meaning and coverage. They are intended to make the policy more readable and provide a better structure for its organization.
2. No other significant change.
1. Discharge and Responsible Party added as new definitions.
2. Vessel General Permit added as a new definition.
The Declarations Page has been simplified as has the Vessel Schedule based on the new premium and limit structure. The Immediate Report Warranty is added to the bottom of the Declarations Page.
WQIS is the largest U.S.-based underwriter of pollution liability insurance for marine vessels. With over 40 years in the industry, no one has more marine pollution insurance and spill response expertise, or offers more innovative coverage to the marine community. WQIS is dedicated to providing the broadest coverage and creating the most responsive organization to serve the needs of their clients.