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Provisions relating to the assessment and payment of Q.E.R. Premiums, the extension and termination of the current policy year and the reinstatement of cover under Rule 5.B after the service of a General Premium Notice

A.1 Queen’s Enemy Risks Premium Periods

A.1.1

Upon the service of a General Premium Notice, the Secretary of State shall declare a Premium Period. If the General Premium Notice has not been withdrawn and is still in force at the time of the expiry of the first Premium Period, the Secretary of State shall declare further Premium Periods in succession to one another. All Premium Periods shall be such length and duration as the Secretary of State shall determine.

A.2 Q.E.R. Premiums

A.2.1

The Insured Owners who, after the service of a General Premium Notice upon the Association, have or continue to have ships entered in the Association for insurance against the Queen’s Enemy Risks where those risks are reinsured by the Government of the United Kingdom (that is to say British Ships and other ships to which the provisions of Rule 4.A.1 apply) shall pay to the Association in respect of each such Entered Ship:

A.2.1.1

Advance Q.E.R. Premiums, which shall be expressed as a percentage of the Insured Value of each such Entered Ship, at the rate determined by the Secretary of State in respect of each Premium Period;

A.2.1.2

Supplementary Q.E.R. Premiums, which shall be expressed as a percentage of the Advance Q.E.R. Premium to which it relates, at the rate determined by the Secretary of State;

A.2.1.3

Such further sums, which shall be expressed as a percentage of the Insured Value of each such Entered Ship, in respect of the expenses of the Association at such rate as the Directors shall from time to time, and for such period of time, determine.

A.2.2

Q.E.R. Premiums shall be payable in full in respect of each Premium Period during which such Entered Ship is entered in the Association for insurance against the Queen’s Enemy Risks. If any such Entered Ship shall be insured for only part of a Premium Period, the Secretary of State may determine that the Q.E.R. Premiums payable in respect of such Entered Ship shall be payable on a pro rata basis representing the time that such Entered Ship is so insured during the relevant Premium Period.

A.2.3

No Q.E.R. Premiums shall be levied in respect of any such Entered Ship until the expiry of the period stipulated in Rule 5.A.4.

A.3 Notices

As soon as is reasonably practicable, the Managers shall notify each Insured Owner of the following:

A.3.1

Such declarations and determinations of Premium Periods which are made by the Secretary of State;

A.3.2

The rate at which a Q.E.R. Premium is charged by the Secretary of State;

A.3.3

Whether a Q.E.R. Premium is an Advance or a Supplementary Q.E.R. Premium and the Premium Period to which it relates;

A.3.4

The amount or amounts which are payable by the Insured Owner;

A.3.5

The date by which any Q.E.R. Premium is payable by the Insured Owner, and, if it is payable by instalments, the amount of each instalment and the date by which it is payable.

A.4 Unpaid Q.E.R. Premiums

A.4.1

If an Insured Owner shall have failed to pay in respect of any Entered Ship when due and demanded by the Association any Q.E.R. Premium, the provisions of paragraphs A.4.2. and A.4.3 shall have effect.

A.4.2

The Association shall not accept for payment or pay or otherwise commit itself to pay to that Insured Owner any claim for losses, liabilities, costs or expenses caused by the Queen’s Enemy Risks until such time as the Q.E.R. Premiums are paid in full. PROVIDED ALWAYS that: the Directors may, with the consent of the Secretary of State, exercise one or more of the following powers:

A.4.2.1

Accept security for the payment of the unpaid Q.E.R. Premiums in such form and for such amount, and on such terms and conditions, as they require for the whole or any part that may be due;

A.4.2.2

Without prejudice to the Association’s rights under Rule 4.E.13, appropriate Q.E.R. Premiums paid in respect of a later Premium Period to Q.E.R. Premiums due and owing in respect of any earlier Premium Period;

A.4.2.3

Accept and pay any claim arising in any Premium Period in respect of which Q.E.R. Premiums are fully paid;

A.4.2.4

Require that interest shall be charged under Rule 30.

A.4.3

The Directors may, and if required by the Secretary of State shall, give notice to the Insured Owner in the form prescribed by Rules 34.1.1 and 34.1.2. If the Insured Owner fails to comply with the requirements of such notice, the provisions of Rules 34.2 to 34.4 and 35.2 and 35.3 shall have effect. PROVIDED ALWAYS that: In the case that the Insured Owner’s cover shall have been reinstated under Rule 5.B, the Directors may, in their discretion, give notice under this paragraph which shall cancel the Queen’s Enemy Risks cover only

A.5 Extension and Termination of Current Policy Year

A.5.1

The Policy Year in the course of which a General Premium Notice is served shall extend (if necessary beyond noon G.M.T. on the 20th February next) and shall terminate at the date when the period or periods provided in Rule 5.A.4 have expired in respect of all the ships which are entered for insurance in the Association or at such other date as the Directors may, in their discretion, determine.

A.5.2

In the event that the said Policy Year shall extend beyond noon G.M.T. on the 20th February next in the manner described in paragraph A.5.1, the respective rights and obligations of the Insured Owner and the Association shall continue to be governed in all respects by the provisions of these Rules until the Policy Year shall have terminated in accordance with the provisions of paragraph A.5.1.

A.6 Reinstated Entries

A.6.1

If the Directors shall make an offer under the provisions of Rule 5.B, the provisions of paragraphs A.6.2 and A.6.3 shall apply.

A.6.2

If such offer shall require the payment of Contributions or Premiums, and provide that the insurance is to be offered for a shorter period than any Policy Year, then that shorter period shall constitute a Policy Year for all the purposes of these Rules notwithstanding that such period is shorter than the Policy Year as defined by these Rules.

A.6.3

The risks so insured by the Association shall be financed by means of a different fund from that used to finance the insurance afforded by the Association in respect of the Queen’s Enemy Risks.

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