MARINE HULL

DEFINITIONS

1. CRAFT means the Craft herself her machinery boat(s) gear and equipment such as
would normally be sold with the Craft if she changed hands.

2. AN ACTUAL TOTAL LOSS under this policy arises where the Craft and her
tackle, fittings and furniture is wholly destroyed or where the Insured is irretrievably
deprived wholly thereof, and not otherwise.

3. A CONSTRUCTIVE TOTAL LOSS under this policy arises where the insured
property as defined in (1) is reasonably abandoned on account of its actual loss as
defined in (2 appearing to be unavoidable or where it could not be preserved from
such actual total loss without an expenditure, which, if incurred, would exceed the
sum shown in the schedule as the sum insured. In ascertaining whether the Craft is a
constructive total loss the sum insured shall be taken as the repaired value and
nothing in respect of the damaged or breakup value of the Craft or wreck shall be
taken into account.

4. IN COMMISSION - The period when the Craft is fitted out ready for the owner’s
immediate use.

5. LAID UP - The period when the Craft is dismantled, not fitted out or ready for
immediate use, loose gear being stored ashore. During the laid-up period the
Craft must not be used for any purpose other than dismantling, fitting out and
customary overhaul.

6. HOUSEBOAT USE - A Craft is said to be used as a houseboat when she is at

anchor, moored or berthed and is being used by the Insured or others for living
on board.

PREAMBLE

The Insured having applied for insurance relating to the Craft described in the Schedule
(hereinafter called the “Insured Craft”) to the (hereinafter called “the Company”) by a
proposal and declaration which shall be the basis of this contract and held as incorporated
herein and having paid or agreed to pay the premium as consideration for such insurance.

The Company agrees subject to the terms contained herein or endorsed hereon to indemnify
the Insured against any of the contingencies specified in this Policy occurring during the
period of insurance.

Circumstances in which the cover granted by this Policy applies

a) While the Insured craft is in commission during the period shown in the Schedule
within the Cruising Limits or in port docks on ways gridirons pontoons or on the hard
 or mud including hauling out and launching with leave to sail or navigate with or
without pilots to go on trail trips and to assist and to tow Craft in distress or as is
customary but it is warranted that the Craft shall not be towed except as is customary or
when in need of assistance or undertake towage or salvage services under a contract
previously arranged by owners or manager or chatterers.

b) While laid up out of commission including hauling out and launching striking over
dismantling fitting out overhauling or while undergoing survey (also to include docking
or undocking and periods laid up afloat incidental to laying up or fitting out and with
leave to shift in tow or otherwise to or from the Craft’s lay-up berth but not outside the
limits of the port or place in which the Craft is laid-up) but excluding unless notice be
given and an additional premium agreed any period for which the Craft is used as a
houseboat or is undergoing alteration or major repair.

The contingencies to which this policy applies:-

SECTION 1: Loss of or Damage to the Insured Craft

SECTION 2: Liability to Third Parties

SECTION 1

Loss of or Damage to the Insured Craft

All loss of or damage to the Insured Craft and her boats (other than those having a designed
speed exceeding 20 miles per hour (17 knots) and those without a permanent mark of the
name of the parent Craft unless specifically declared and agreed) including equipment while
in store ashore directly caused by:-

a) External accidental means including stress of weather stranding sinking or collision

b) Fire self-ignition lightning or explosion
c) Accidents in handling loading and discharging stores equipment machinery or fuel
d) Bursting of boilers breakage of shafts latent defects in the hull or machinery
e) Contact with aircraft
f) Malicious acts
g) Theft of the entire Craft or her boat(s) or outboard motor(s) provided it is securely
locked to the Craft or her boat(s) by anti-theft device) or theft of machinery gear or
equipment following forcible entry in the Craft or place of storage
h) Loss of or damage to the Craft caused by negligence of any person whatsoever but
excluding the cost of making good any defect resulting from either negligence or
breach of contract in respect of any repair or alteration work carried out for the
Insured and/or the owner or in respect of the maintenance of the Craft

Provided always that any such loss or damage has not resulted from the want of due
diligence by the owners of the Craft or by any of them or by the manager or by the Insured
and in no case shall the Company be liable for unrepaired damage in addition to a
subsequent total loss sustained during the period of Insurance.

In addition the Company shall pay for:-

(i) The expense of sighting the bottom after stranding, if reasonably incurred, whether
the Craft be found damaged or not

(ii) Loss or damage to the clothing of the crew provided by the owner binoculars sextant
nautical books oilskins sea boots and yatching clothing the property of the
Insured or his family caused by the Craft being stranded sunk burnt or in collision
up to an amount equivalent to 2.5 percent of the sum insured on the Craft (unless
otherwise agreed) in respect of any one accident.

Exceptions to this Section:-

The Company shall not be liable in respect of:-

1) Loss or damage caused by vermin wear and tear depreciation and deterioration from
use
2) Loss or damage to moorings fishing gear and consumable stores
3) Sails and protective covers split by the wind or blown away while set unless in
consequence of damage to the spars to which the sails are bent or occasioned by the
Craft being stranded in collision with any external substance (ice included) other
than water
4) Loss or damage to sails masts spars or standing and running rigging while the vessel
is racing unless such loss or damage is caused by the Craft being stranded sunk burnt
on fire or in collision with any external substance (ice included) other than water
5) (a) Motor and electrical machinery and batteries, and their connection (with
exception of the shaft and propeller)
(b) Metalling or repairs thereto

Unless the loss or damage is caused by the Craft being stranded sunk burnt on fire or in
collision or contact with any external substance (ice included) other than water or whilst
being removed from or placed in the Craft or by theft of the entire Craft or by theft
following forcible entry into the Craft or store or by theft of outboard motor provided it is
securely locked to the Craft or her boat(s) by an anti theft device in addition to its normal
method of attachment or by fire in the store ashore or by malicious acts or by dropping off
or falling overboard of outboard motor.

6) Any loss or expenditure incurred solely in remedying a fault in design or in the event
of damage resulting from faulty design and giving rise to a claim under the
conditions of this policy for any additional expenditure incurred by reason of
betterment or alteration in design or for the cost and expense of replacing or
repairing any part condemned solely in consequence of a latent defect or fault
or error in design or construction.

Provided that the sum which the Insured may recover under this Section shall not exceed:-

a) Incase of an actual or constructive total loss the sum insured shown in the schedule
b) In the case of a partial loss the reasonable cost of repairing or reinstating the
damaged or lost part of the insured property and necessary expenses connected
therewith
Provided further that in no case shall the Company be liable to pay under this Section more
than the sum insured on the Craft as shown in the schedule.

NB

Deductions new for old not exceeding one third may be made in respect of loss or damage
to protective covers sails running rigging and outboard motors whether or not insured by
separate valuation under this policy.

SECTION 2

Liability to Third Parties

The Company will indemnify the Insured in respect of all claims made by Third parties and
passengers for which the Insured shall by reason of his interest in the insured Craft become
legally liable to pay and shall pay for death injury or damage to persons or their property
including damage to piers docks wharves and jetties and cost of any attempted or actual
raising removal or destruction of the wreck of the Insured Craft or any neglect or failure to
raise remove or destroy it up to the limit of indemnity for this section shown in the schedule
(which shall be deemed to include a series of accidents occurring in connection with or
arising out of any one event) but unlimited in the aggregate.

The Company will be responsible for legal costs incurred with the consent in writing of the
Company in settling or defending any claim and for all salvage charges and necessary
expenses incurred in minimising or averting a loss that would form a claim under this
section

The cover granted by this section extends subject to the terms and limitations of this policy
to indemnify any person (other than a person operating or employed by the operator of a
shipyard repair yard slipway yacht club sales agency or similar organisation) navigating or
in charge of the insured Craft with the permission of the Insured and who whilst so
navigating or in charge of the insured Crafts shall in consequence of any occurrence for
which the Insured is indemnified under this section become liable to pay and shall pay any
sum or sums by way of damages to any person or persons other than the Insured.

The Company shall not be liable in respect of accidents to or illness of workmen or other
persons employed in any capacity whatsoever by the Insured or by persons to whom this
section is extended as aforesaid in or on about or in connection with the Insured Craft or any
work or repair thereto.

CLAUSES ATTACHING TO AND FORMING PART OF THE POLICY

Speedboat Clauses (applicable to Sections 1 and 2)

These clauses apply to all Craft whose design speed exceeds 20 miles per hour – 17 Knots)
1) It is a condition of this insurance that when the insured Craft is under way the
Insured named in the schedule or other competent person(s) shall be on board and in
control of the Craft.

2) No claim shall be allowed in respect of:-

a) loss of or damage to the insured Craft or liability to any third party or any
salvage services:-
i) caused by or arising from the Craft being stranded sunk swamped or
breaking
adrift while left moored or anchored unattended off an exposed beach
or shore
ii) arising while the Craft is participating in racing or speed tests or any
trials in connection therewith
b) rudder propeller strut shaft motor electrical machinery or batteries and their
connections unless the loss or damage is caused by the Insured Craft being
stranded sunk burnt on fire or in collision with any other Craft pier or jetty or
while being removed from or placed in the Craft or by theft of the entire
Craft or by theft following upon forcible entry into the Craft or place of
storage or by theft of outboard motor provided it is securely locked to the
Craft or her boat(s) by an anti theft device in addition to its normal method of
attachment or by fire in the place of storage ashore or by malicious acts or by
dropping off or falling overboard of outboard motor
c) any liability to or incurred by any person engaged in water skiing
aquaplaning or similar sport while being towed by the Insured Craft or
preparing to be towed or after being towed until safely on board the Craft.

3) If the insured Craft is fitted with inboard machinery no liability shall attach to this
policy in respect of any claim caused by or arising through fire or explosion unless
the vessel is equipped in the engine room or engine space tank space and galley with
a fire extinguishing system automatically operated or having controls at the steering
position and properly installed and maintained in efficient working order.

Excess Clause

In respect of each claim the insured shall bear the costs of any loss or damage up to the
amount of the excess shown in the schedule except in respect of any claim for total loss of
the Craft.

Exceptions applying generally to this policy

Unless specifically agreed by endorsement of this policy the Company shall not be liable in
respect of:-

1) any accident injury loss or damage occurring while the Craft is let out on hire or
charter or used other than for private pleasure
2) any contingency occasioned by or happening through war invasion act of foreign
enemy hostilities (whether war be declared or not) civil war rebellion revolution
insurrection or military or usurped power martial law military or usurped
power or attempts at usurpation of power
3) loss or damage caused by strikes locked out workmen or persons taking part in
labour disturbances riots or civil commotions
4) loss or damage caused by any act of one or more persons whether or not agents of a
sovereign power for political or terrorist purposes and whether the loss or
damage resulting therefrom is accidental or intentional.
5) loss or damage caused by any malicious act or act of sabotage
6) claims caused by confiscation nationalisation seizure restraint detention
appropriation requisition for title or use by under the order of any Government
(whether civil military or de facto) or public or local authority
7) claims caused by hi jacking or any unlawful seizure or wrongful exercise of control
of the Craft or crew (including any attempt at such seizure or control) made by any
person or persons on board the Craft acting without the consent of the Insured
8) loss or destruction of or damage to any property whatsoever or any loss or expense
whatsoever resulting or arising therefrom or any consequential loss or any legal
liability of whatsoever nature directly or indirectly caused by or contributed to by or
arising from
i) ionising radiations or contamination by radioactivity from any nuclear fuel or
from nuclear waste from the combustion of nuclear fuel
ii) the radioactive toxic explosive or other hazardous properties of any explosive
nuclear assembly or nuclear component thereof

PRIVILEGES AND EXTENSIONS

Salvage and sue and labour. In case of misfortune to the insured Craft it shall be lawful for
the Insured or the Insured’s factors and servants to sue labour and travel for in and about the
protection safeguard or repair of the insured Craft without prejudice to this insurance. All
charges thereof including salvage charges the cost of towing or removing the Craft to a
place of safety and of the attempted or actual raising removal or destruction of the wreck of
the Craft properly so incurred shall form part of the claim provided that the Insured
forwards at once to the Company a detailed estimate from a competent firm of the cost of
any immediately necessary repairs together with full particulars of the accident and it is
agreed that no acts of the Company or the Insured in recovering saving or preserving the
property shall be considered as a waiver or acceptance of abandonment.

Medical Expenses. The Company will refund any doctor’s or surgeon’s fees (up to an
amount not exceeding Kshs. 15,000/-) for attendance upon the Insured or his wife (or her
husband) if either shall sustain personal injuries by violent accidental external and visible
means as a direct result of the insured Craft sinking or being in collision.

Sister Ship Clause. Should the insured Craft come into collision with or receive salvage
services from another Craft belonging wholly or in part to the Insured or under the same
management, the Insured shall have the same rights under this policy as he would have were
the other Craft entirely the property of owners not interested in the insured Craft, but in such
cases the liability for the collision shall be referred to a sole arbitrator to be agreed between
the Insured and the Company.

No Claim Discount. (Applicable only to Craft valued under Kshs. 3,000,000/- and insured
under Section 1 & 2)
If no claim is made or is pending under this policy during a period of insurance specified
below immediately preceding the renewal of the policy the renewal premium shall be
reduced as follows provided that the insured Craft shall have been in commission for a
minimum of four months during the preceding twelve months.
 Period of Insurance Reduction (%)
1 Complete Year 5.0
2 Complete and consecutive years 7.5
3 Complete and consecutive years 10
4 or more complete and consecutive years 15

Provided that the discount is payable only if the insurance is renewed for a further period of
twelve months (minimum four months in commission) and on the understanding that this
privilege shall not imply any obligation on the Company or the Insured to renew

GENERAL CONDITIONS

1) The Insured shall maintain and keep the insured Craft her machinery tackle sails and
equipment in a proper state of repair and seaworthiness and shall at all times exercise
due care and diligence in safeguarding them.
2) This policy may be cancelled by either the insurers or the insured by giving 10 days
notice in writing of such cancellation. If cancelled by the Insurers they will return a
pro rata portion of the premium in respect of the unexpired period of the policy. If
cancelled by the Insured a return of premium shall be at the discretion of the
Insurers. There will be no return of premium in respect of any Craft on which a loss
is paid or is payable under this policy.
3) No amount shall be insured policy proof of interest or full interest admitted for the
account of the insured and/or mortgages on disbursements commission profits or
other interests or excess or increased value of hull and/or machinery however
described unless the insured Craft is valued at over Kshs. 3,000,000/- and then not
exceed 10 per cent of the total sum insured as stated in the schedule.
4) If this policy or any renewal thereof has been obtained through omission to state any
material fact or through any mis-statement by the Insured or his agent or if any
statement or declaration made in respect of any claim there shall be any untruth or
suppression then this policy and renewal thereof shall be null and void and the
premiums paid shall be retained by the Company and all benefits and all right to
recover past or future damage or loss shall be forfeited.
5) No assignment of or interest in this policy or in any monies which may be or become
payable shall be binding on or recognised by the Company unless a dated notice of
assignment or interest signed by the Insured and (in the case of subsequent
assignment) by the assignor also be endorsed on this policy and the policy (with
such endorsement) be produced before payment of any claim or return of premium.
Nothing in this condition is to have effect as an agreement by the Company to a sale
or transfer to a new management.
6) In the event of any other insurance by whomsoever effected covering the same
accident injury loss or damage as this policy the Company shall be liable to
contribute only its rateable proportion of such injury or damage.
7) This policy shall be construed in accordance with Kenyan Law and any dispute or
difference between the Insured and the Insurers be submitted to arbitration in Kenya
with the Statutory provision for arbitration for the time being in force.

Conditions relating to claims

1) In the event of injury loss or damage which may result in a claim under this policy
notice in writing must be given immediately to the Company prior to survey so that
the Company may appoint its own surveyor if it so desires.
2) The Company shall have the right to veto the place of repair or repairing firm
proposed. As soon as the extent of the damage is ascertainable the Company may
take or may require to be taken tenders for the repairing of such damage.
3) The insured shall give full information as to the circumstances of the accident and of
all claims made with the names and addresses of all claimants and all witnesses of
the accident or receipt of claim or notice of claim.
4) No liability shall be admitted nor legal expenses incurred without the written consent
of the Company who shall be entitled if it so desires to take over and conduct in the
name of the insured the defence of any action or to prosecute any claim for
indemnity or damage or otherwise against any third party.
5) The Company may at its option reinstate or replace any part of the insured property
damaged or destroyed instead of paying the amount of the loss or damage in money
or may join with other insurers in so doing. Reinstatement effected as nearly as
reasonably practicable shall be a fulfilment of the Company’s obligations under this
policy notwithstanding that the former appearance and condition of the property may
not be precisely restored. If the Company elects to reinstate or replace the Insured
shall comply with any request it may make for plans, specifications and information.
6) If any difference shall arise as to the amount to be paid under this policy (liability
being otherwise admitted) such difference shall be referred to an arbitrator to be
appointed by the parties in accordance with the statutory provisions in that behalf for
the time being in force. Where any difference is by this condition to be referred to
arbitration the making of an award shall be a condition precedent to any right of
action against the Company.
THE SCHEDULE

AGENT:

BRANCH POLICY NO:

FIRST PREMIUM: ANNUAL PREMIUM:

INSURED:

ADDRESS:

INSURED CRAFT

Pax: Nil

Third Party Property Damage: Kshs. each accident Hull :

/Event
2No. Outboard Motors :
Third Party Injury: Kshs. each accident /Event
Equipment
Passenger Legal Liability: Kshs. each accident /Event
Excess:
Aggregate Liability Limit : Kshs.

Excess: Kshs.

INSURED CRAFT :
Pax:

Third Party Property Damage: Kshs. each accident Hull :

/Event
No. Outboard Motors :
Third Party Injury: Kshs. each accident /Event
Equipment :
Passenger Legal Liability: Kshs. each accident /Event
Excess:
Aggregate Liability Limit : Kshs.

Excess:

PERIOD OF INSURANCE: (Both dates inclusive)

a) FROM: TO:

b) Any subsequent period for which the Company shall have agreed to renew this
policy
ENDORSEMENTS: As per the attached memo 2

CURRENCY WARRANTY: For the purpose of this insurance all premiums and claims
will be payable in Kenya Shillings.

The policy and this schedule shall be read together as one contract and any word or
expression to which a specific meaning has been attached in any part of the policy or this
schedule shall bear such specific meaning wherever it appears.

CLAUSES & WARRANTIES

1
1) Including transit by Road
2) Including Riot, Strike Malicious acts but excluding War risk
3) Excluding liability to and of Skiers
4) Excluding Pollution hazards
5) Excluding Racing risks

MEMO 2: SPECIAL ENDORSEMENTS

1. Including equipment in store aboard

2. Including transit by Road
3. Including Riot, Strike Malicious acts but excluding War risk
4. Including dropping off of Outboard motors
5. Excluding liability to and of Skiers
6. Excluding Pollution hazards
7. Excluding Racing risks