Rule 17 Cesser

A Member shall (subject to Rule 17.5) cease to be covered by the Association in respect of any and all Vessels entered in the following circumstances:

1. where the Member is a corporation, a resolution is passed for the voluntary winding up of the Member or an order is made for its compulsory winding up or it is dissolved or a receiver or similar official to all or part of its affairs is appointed or any secured party takes possession of any of its property or it seeks protection from its creditors under any applicable bankruptcy or insolvency laws or any similar event occurs (in the determination of the Association) in any applicable jurisdiction; and

2. where the Member is an individual, the Member dies or becomes incapable by reason of mental disorder of managing or administering its property and affairs or becomes bankrupt or makes any composition or arrangement with its creditors generally or a receiving order is made against the Member or any secured party takes possession of any of its property or any similar event occurs (in the determination of the Association) in any applicable jurisdiction.

The Member shall (subject to Rule 17.5) cease to be covered by the Association in respect of any Vessel entered in the following circumstances:

1. the Vessel becomes a total loss;

2. the Vessel is accepted by the hull underwriters (whether of marine or war risks) as a constructive total loss;

3. the Vessel suffers damage and the cost of repairs (as determined by the Association) will equal or exceed the higher of 80% of its insured value or of its value in repaired condition (as determined by the Association);

4. the Vessel is transferred to a new owner by sale or otherwise;

5. new managers of the Vessel are appointed or there is a change in the operator of the Vessel;

6. any mortgagee or other secured party enters into possession of the Vessel;

7. the Vessel ceases to be classed with a classification society approved by the Association, or its class is suspended;

8. the Vessel is requisitioned;

9. the Vessel, with the consent or knowledge of the Member, is being used for the furtherance of illegal purposes.

Where the Vessel disappears, it shall be deemed to be a total loss ten days from the day it is last heard from.

Notwithstanding and without prejudice to Rules 17.1, 17.2 and 17.3, a Member shall forthwith cease to be insured by the Association in respect of any and all Vessel(s) entered if any Vessel is employed by the Member in a carriage, trade or on a voyage which will thereby in any way howsoever expose the Association and/or its Agent to the risk of being or becoming subject to any sanction, prohibition or adverse action in any form whatsoever by any State where the Association and/or its Agent has its registered office or permanent place of business or the United Nations, the European Union, the United Kingdom or the United States of America.

Notwithstanding the provisions of Rules 17.1, 17.2 and 17.4, the Association may decide in any particular case that cover shall be continued without interruption, or that cover shall be reinstated, in either case on such terms as the Association shall determine.

Notwithstanding the provisions of Rule 17.2. (a), (b) and (c) the Association shall cover subject to these Rules and the terms of entry agreed, liabilities, losses, costs and expenses flowing from the casualty which gave rise to the total loss or constructive total loss of the Vessel.