Lloyd’s Market Association Bulletin

In December 2019, Lloyd’s Insurance Company S.A. (Lloyd’s Brussels) produced two new Service of Suit clauses and Jurisdiction Clauses for use on Lloyd’s Brussels business. The purpose of the two clauses is to give the market greater clarity as to their use in relation to other dispute resolution arrangements in an insurance contract.

LBS006A – Service of Suit and Jurisdiction Clause: This clause replaced LBS0006. The use of LBS0006A is strongly recommended where a managing agent – acting on behalf of Lloyd’s Brussels – has appointed a nominee (which may be a law firm, insurance intermediary or a third-party administrator) to receive service of suit.

LBS0081 – Service of Suit and Jurisdiction Clause: The use of LBS0081 is strongly recommended where the managing agent (and therefore Lloyd’s Brussels) has not appointed a nominee (i.e. has not appointed a third party such as a law firm, insurance intermediary or a third-party administrator) to receive service of suit. Notice is therefore to be sent to either Lloyd’s Brussels Head Office or Lloyd’s Brussels’ General Representative in the country concerned, depending on whether or not Lloyd’s Brussels holds a freedom of establishment licence in that country:

• Where Lloyd’s Insurance Company S.A. does hold a freedom of establishment licence in a country and no nominee is chosen by the managing agent, proceedings are to be served to Lloyd’s Insurance Company S.A.’s General Representative for that specific territory.
• Where Lloyd’s Insurance Company S.A. does not hold a freedom of establishment licence in a country and no nominee is chosen by the managing agent, proceedings are to be served to Lloyd’s Insurance Company S.A.’s Head Office.

Both clauses are available on the Lloyd’s Wordings Repository, along with translations into various European languages.

It remains mandatory for all Lloyd’s Insurance Company S.A. contracts to contain an appropriate service of suit clause in order to ensure that any legal action is properly served.

For more detail regarding service of suit requirements within any EEA territory, reference should be made to the relevant country page on Crystal.

Lloyd’s Market Association Bulletin

Further to our bulletin dated 13 February 2024 regarding changes to oil cap provisions and updated clauses, the following guidance is now available. 

Oil Price Cap Guidance Hull and Cargo – LMA5610A and LMA5611A

Arabella Ramage

Legal Director
arabella.ramage@lmalloyds.com

Lloyd’s Market Association Bulletin

The LMA has published a model Canadian Arbitration Clause, LMA5633, suitable for use in all Canadian provinces and territories.

The clause sets out how the panel of three arbitrators will be selected and specifies the qualifications they must have.

Arbitrators are required to come to a reasoned written decision, with the losing party paying the costs of the arbitration.

The law that the arbitration will be subject to, and the seat of arbitration are left blank. Thus, please note that when using this model clause, paragraphs 9 and 10 must be completed by filling in the name of the relevant Canadian province, territory or city. 

Toby Clark
Executive, Technical Underwriting
toby.clark@lmalloyds.com

Ray Koh
Legal Counsel
ray.koh@lmalloyds.com

Lloyd’s Market Association Bulletin

The LMA is reissuing LMA5612 and LMA5613 clauses to respond to the recent changes to the Oil Price Requirements.

LMA5612A – Political Risk Oil and Oil Price Cap Endorsement

LMA5612A Price Cap Exception Clause (Political Risk) – Appendix 1

LMA5612A Price Cap Exception Clause (Political Risk) – Appendix 2

LMA5613A – Credit Risk Oil Price Cap Endorsement

LMA5613A Price Cap Exception Clause (Credit Risk) – Appendix 1 Pre-Inception Endorsement Attestation

LMA5613A Price Cap Exception Clause (Credit Risk) – Appendix 2 Qualifying Voyage Attestation 

Arabella Ramage
Legal Director
arabella.ramage@lmalloyds.com

Lloyd’s Market Association Bulletin

The LMA is reissuing LMA5610A to change the period of time for obtaining documentation to 30 days from 28 days in accordance with the recent amendment to OFSI’s guidelines. We are also issuing new LMA5610B to respond to feedback from insurers. 

In LMA5610B we have deleted the obligation to obtain price information as well as an attestation for each voyage. We consider that in most circumstances insurers can reasonably rely on the provision of an attestation alone to comply with the relevant requirements of the updated price cap regime. We have informed both OFAC and OFSI of this change. 

There may be occasions where an insurer subject to OFSI jurisdiction considers that they could be within a different Tier from 3A (based upon access to price information). In such case they may have additional obligations (also as to reporting to OFSI) and prefer to use LMA5610A.

LMA5610A Cargo Oil and Oil Products Price Cap Notice and Clause Endorsement

LMA5610B Cargo Oil and Oil Products Price Cap Notice and Clause Endorsement

Arabella Ramage
Legal Director
arabella.ramage@lmalloyds.com

Lloyd’s Market Association Bulletin

This version of the clause has been updated to address a deficiency in the previous version, which carriers viewed as unsuitable for partial losses. In this updated clause, the aim is to target the policy’s indemnity exposure.

Onshore Energy BI Volatility Clause – LMA5515A 

For more information or if you have any other enquiries, please contact Dele Fajimolu: dele.fajimolu@lmalloyds.com.

Dele Fajimolu

Senior Executive, Technical Underwriting

Lloyd’s Market Association Bulletin

Following the recent ballot, 10 individuals have been elected as members of the LMA Marine Committee for a two-year term:

• Richard Palengat, AEGIS 
• Simon Mason, Apollo 
• David Sankey, Atrium 
• Sundeep Khera, AXA XL 
• Charles Fernandez, Canopius 
• Mark Edmondson, Chubb 
• Brendan Flood, Hiscox 
• Bill Katesmark, MAP
• Stuart Forsyth, MS Amlin 
• Robert McAdams, Munich Re 

A full list of panel members appears on the Marine Committee page.

We would like to thank everyone who participated in the election process.

For more information, or if you have any other enquiries, please contact the panel secretary Neil Roberts on: neil.roberts@lmalloyds.com.

Neil Roberts

Head of Marine and Aviation, Underwriting

Lloyd’s Market Association Bulletin

Following the recent Joint Marine Committee ballots, please see the links below to the successful candidate(s) for each committee:

Joint Committee 2024 election results – Joint Cargo Committee

Joint Committee 2024 election results – Joint Hull Committee

Joint Marine Committee 2024 election results – Joint Excess Loss Committee

Joint Marine Committees 2024 election results – Joint Specie Committee

Joint Marine Committees 2024 election results – Joint War Committee

We would like to thank everyone who participated in the election process.

Neil Roberts

Head of Marine and Aviation, Underwriting

Lloyd’s Market Association Bulletin

The LMA’s Contingency Business Panel has published a model Accident/Accidental Death Endorsement (LMA5632) for use in contingency business. 

Please note that Paragraph 1 requires an amendment to ensure that the correct perils references are provided (which depends on the wording that this endorsement attaches to): 

• If using LMA3164 (UK Non-Appearance) or LMA3166 (US Non-Appearance), Peril 3.1 is the Death of any Insured Person and Peril 3.2 is Accidental bodily injury or illness.
  
• If using LMA3112A or LMA3147A, the above Perils are listed at 2.1 and 2.2.

David Powell
Head of Technical Underwriting
david.powell@lmalloyds.com

Lloyd’s Market Association Bulletin

The LMA has amended the guidance note LMA24-012-AR accompanying LMA3100A and LMA3200 to take into account requests for clarification from the market. 

• This guidance and the clauses have been discussed with OFAC. While neither were submitted for formal interpretative guidance, OFAC reviewed them and noted they did not identify any red flags. We agreed with OFAC that the goal of the clauses was to ensure no service (cover) was provided to any sanctioned persons, activities, or geographies as described. We also agreed to work with OFAC to update its existing guidance related to industry clauses to reflect this focus. OFAC made clear that anyone in doubt as to the suitability of a clause for their particular situation is able to discuss with them direct.
  
• In terms of the UK government, the clauses have also been discussed and are referred to as suitable clauses for use in the Oil Price Cap guidance that has recently been issued.
  

Sanctions Clause Guidance Update – LMA3100A and LMA3200

Arabella Ramage
Legal Director
arabella.ramage@lmalloyds.com