A merican Club Circular No. 06/23 1 MARCH 7, 2023 CIRCULAR NO. 06/23 TO MEMBERS OF THE ASSOCIATION Dear Member: COVER FOR WAR AND TERRORISM RISKS, AND COVER IN RESPECT OF BIOLOGICAL AND BIO-CHEMICAL ETC. WEAPONS AND COMPUTER VIRUSES – 2023 POLICY YEAR This Circular describes the arrangements which have been made to provide special cover for war and terrorism risks, and cover in respect of chemical, biological, bio-chemical and electromagnetic weapons and computer viruses, for the 2023 policy year. War and terrorism risks For 2023, cover for war and terrorism risks will remain available from the Club in accordance with the relevant proviso to Rule 3.1.1 of the Rules of Class I. This cover will apply in excess of an insured vessel’s proper hull value, or $500 million, whichever is the lower amount, subject to a minimum excess point of $50,000, and will be for a limit of $500 million for 2023, however, subject to a sub-limit of $80 million for vessels operating within all Russian waters and certain European waters as defined within Addendum I below. Members were advised of the renewal of the International Group’s General Excess of Loss Reinsurance Contract in the Club’s Circular, 01/23, dated January 17, 2023. As mentioned in that Circular, the Group’s separate Excess War P&I placement was to include Territorial Exclusionary Language for ships trading in the waters of Russia and Ukraine, but that the extent of the exclusion and any potential “buy-back” was not known at that time and would be advised in due course. The cover itself has nevertheless been renewed with effect from February 20, 2023, with the shipowner rates included within the overall rates set out in the aforementioned Circular. However, as a consequence of a contraction of the cover available from reinsurers, there is now an amendment to the level of cover available for vessels operating within all Russian waters including their coastal waters up to 12 nautical miles offshore, and certain Belarusian, Ukrainian and European waters due to the current conflict, with cover being sub-limited to $80 million any one event, each vessel. Addendum I to this Circular sets out the terms of this excess cover. It will apply to all vessels insured on fully mutual conditions in accordance with the Rules of Class I, into the cover of which these terms will be deemed to be incorporated. A merican Club Circular No. 06/23 2 Cover in respect of chemical, biological, bio-chemical and electromagnetic weapons and computer viruses The International Group of P&I Clubs’ pooling facility to provide cover for certain war and terrorism risks, which are otherwise excluded because most War Risk Hull and P&I policies contain a chemical, biological, etc. exclusion, will continue for the forthcoming policy year. The risks covered by virtue of the pooling facility are in respect of a Member’s liability: a. to pay damages, compensation or expenses in consequence of the personal injury to, or illness or death of, any seaman (including diversion expenses, repatriation and substitute expenses and shipwreck unemployment indemnity); and b. for the legal costs and expenses incurred solely for the purpose of avoiding or minimizing any other P&I liability arising from a bio-chemical event (other than under Class I, Rule 2, Section 20, being the “Omnibus Clause”). The limit of cover will be $30 million (the same as for 2022) any one event for each vessel. Addendum II to this Circular sets out the terms of this cover. It