Summary. 
17 
and after the outbreak of war, receiving for voyages com mencing after the outbreak of 
war 20 per cent, of the premiums fixed by the State. 
(8.) That all expenses of administration shall be borne by the Clubs. 
(9.) That the Club policy shall contain the following warranties:— 
(a.) That no ship insured by the State shall start on a voyage if ordered by the 
Admiralty not to do so, and that under both the policy relating to a new 
voyage and the policy relating to the completion of the voyage any orders 
that the Admiralty may give as to routes, ports of call, and stoppages shall 
he obeyed. Provided that, in case of breach, the above warranty shall not 
operate if the assured can satisfy the Committee of the Club that such 
breach happened without the fault or privity of the assured and of the 
owners and of the managers of the ship. 
(b.) That the ship insured shall be deemed to be at all times fully insured against 
all perils covered by an ordinary Lloyd’s policy (with collision clause 
attached) and containing an F. C. and S. Clause, and no claim whatever 
against which the ship is deemed to he otherwise insured as aforesaid, or 
against which she is in fact insured by any other insurance policy, shall be 
recovered under the Club policy. 
(10.) That ships so insured undertake, as far as possible, to carry out the orders of 
the State in regard to their routes, ports of call, and stoppages. Failure to carry out 
such orders will involve an appropriate penalty, but such failure shall not be treated as 
a breach of warranty. 
(11.) That each Club and its constitution shall be approved by the State. 
(12.) That the State shall be represented on the Committee of each Club. 
(13.) That the basis of values for the purposes of State insurance shall be the 
value accepted for income tax purposes, that is to say, the first cost of the vessel, 
without allowance for the cost of alterations or additions, less depreciation at the rate 
of 4 per cent, per annum, but without any minimum limit per ton. 
(14.) That the Club shall not be bound to pay a loss if the ship be recaptured, or 
released, or restored to the assured within six months after the date of capture, but in 
that event the Club to pay the assured— 
(i.) The cost of repair or damage received by the ship by reason of such 
capture, &c. 
(ii.) The expenses incurred in respect of the ship by reason of such capture, &c. 
(iii.) A sum equal to 10 per cent, per annum on the insured value from the date 
of capture until release. 
(15.) That claims shall be dealt with and settled by the Committee of the Club. 
If a claim be settled with the approval of the State’s representatives on the Club 
Committee, the State to pay on the agreed figures. If the State’s representatives 
protest against a proposed settlement, the liability of the State under its policy of 
reinsurance to be settled (failing agreement to refer to arbitration) by the Courts 
of Law. 
(16.) That in the event of loss by destruction or capture, the first payment by 
the State shall be made at the end of six months after the event. 
(17.) That the liability of the State shall be discharged in three equal instalments 
at six, nine, and twelve months from the date of loss or capture, with interest at 
the rate of 4 per cent, per annum. 
(18.) That a Board of Experts shall be appointed to advise the State on the 
question of rates and variations of premiums, and that the State shall have one or 
two representatives on this board. 
(19.) That this arrangement shall only extend to vessels which are in the Clubs 
and which are under the British flag and registered in the British Isles. 
(20.) That the State should be prepared, if necessary, to make similar arrangements 
with other bodies than the existing Clubs, provided such other bodies represent a 
sufficiently important amount of tonnage and can provide satisfactory machinery for the 
protection of the State in the matter of values and of claims. 
92. (J3.) In the case of Cargoes— 
(l.) That no arrangement shall be made for the insurance by the State of cargoes 
afloat at the time of the outbreak of a war in which we are a belligerent. 
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