Changes to War Risks Areas – JWLA030 dated 04.04.22

WHAT ARE THE CHANGES

On 4th April 2022 the Joint War Committee implemented changes to the Areas of Perceived Enhanced Risk that are used as the foundation for trading exclusions in War Risks insurance policies.

The following listed areas have been added to the list:

Russia

The following listed areas have been amended in the list - the amendment is only in the exclusion's description:

Sea of Azov and Black Sea waters plus inland waters as defined overleaf.

HOW WILL YOUR WAR RISKS POLICY BE AFFECTED

The above new excluded areas will most likely be incorporated into your policy of insurance. There are usually two ways in which this could happen:

- If your War Risks insurance is placed with or led by a “Club” or “Association”, the insurer will most likely issue a circular that will apply to all policies of insurance noting that the new areas will automatically be incorporated into the policy with effect from a future date.

- If not, your War Risks lead insurer will need to issue notice (usually to your broker) that the new list of areas will be incorporated specifically into your policy with effect from a future date.

Insurers usually allow between 2-7 days for such a change to come into effect.

Any policies that contain pre-agreed rates for trade into newly excluded areas might need to have those rates revalidated or renegotiated.

We draw your attention to the requirement in most Protection & Indemnity policies of insurance that underlying war risks insurance, including a primary layer of war P&I cover, needs to be in place. This includes the period while vessels are within the new listed areas.

If the additional JW2022/007 clause has been introduced into your policy without amendment, the notice period is 48 hours in accordance with the provisions of the clause. Per our previous Marine Client Advisor, the JWC has withdrawn this clause pending further review.

ILLUSTRATIVE MAP

Howden’s marine clients will shortly receive an illustration of the new war risks areas. If this does not reach you, please let us know. This illustration should enable your operational and commercial teams to identify the new areas visually and to plan for the changed dynamic that may arise in respect of existing and future trade.

AWRP.INSURE

If you have not yet tried it, please visit our online premium indication tool AWRP.insure.

The tool is an online premium calculator. It enables prompt computation of a very rough indication of additional war risks insurance premiums (AWRP), Kidnap and Ransom insurance premiums (K&R), as well as premiums for Loss of Hire (LOH) for both AWRP and K&R (AWRP LOH and K&R LOH). Its purpose is to enable prompt and accurate budgeting of additional premiums at the time of commercial voyage calculations.

For any questions regarding the contents of this Marine Client Advisor or for any other marine insurance enquiries please do get in touch.

Howden Insurance Brokers is not a technical, commercial or legal adviser. Any commentary made in this document should not be construed as such, and we do not guarantee in any way the accuracy of the resources used or referenced in this document. In case of doubt, formal advice should be obtained that is directly relevant to your circumstances.