War Risks P&I Cover 28 March 2003 No.02-023 We refer to circular number 02-018 dated 17 February 2003 and circular number 02-019 dated 20 February 2003 in relation to the captioned matter. Due to changes in the available reinsurance the terms of the cover were changed for 2003/04. The reinsurance changes were notified to the International Group only shortly before the renewal and the International Group has been seeking to clarify two issues. Please bear in mind that the following understanding of the reinsurance terms is applicable to the relevant terms of the P&I War Risks Clause of the Association. 1. Chemical, Bio-Chemical, Electromagnetic Weapons and Computer Virus Exclusion Clause This clause is new for 2003/04 and has been introduced as a result of the introduction of similar clauses in almost all reinsurance policies to avoid undue aggregation of risk. The clause reads as follows:- This clause shall be paramount and shall override anything contained in this insurance inconsistent therewith 1. In no case shall this insurance cover loss damage liability or expense directly or indirectly caused by or contributed to by or arising from 1.1 any chemical, bio-chemical or electromagnetic weapon. 1.2 the use or operation, as a means for inflicting harm, of any computer virus. Note:  In circular number 02-018 this clause was referred to as "Chemical, Biological, Bio-chemical, Electromagnetic Weapons and Cyber Attack Exclusion". Problems have arisen with the interpretation of this clause and it is potentially much too wide. Following discussions between the International Group, its brokers and reinsuring underwriters, the brokers have issued the following statement with the approval of reinsuring underwriters:- "The Chemical etc., Exclusion Clause (MM Clause No. 2249(a)) was introduced to this placement for the first time at 20th February 2003. It is our understanding that the phrase 'any chemical, bio-chemical ........ weapon' was intended by Underwriters