Decision ID: 001608

In October 2002 the 1971 Fund Administrative Council recalled that the 1971 Fund had purchased insurance covering any liabilities of the 1971 Fund for compensation and indemnification up to 60 million SDR per incident minus the amount actually paid by the shipowner/insurer under the 1969 Civil Liability Convention as well as legal and other expert’s fees in respect of all incidents occurring between 25 October 2000 and 24 May 2002, the date when the 1971 Fund Convention ceased to be in force. The Council also recalled that under the terms of the insurance policy the 1971 Fund had to cover a deductible of 250,000 SDR for each incident. The Council noted that the insurance contract stipulated that the conversion of SDR into pounds sterling should be calculated by the Fund in accordance with its normal operating procedures or by a competent court and that it did not deal with the conversion of the SDR into any other national currency. The Council endorsed the Director’s proposal that the relevant date for the conversion of the deductible into pounds sterling should be the date of the incident (28 May 2001). It was noted that the SDR:pound sterling exchange rate on 25 May 2001 (26, 27 and 28 May being non-banking days) was 1 SDR = £0.88513, giving a deductible of £221,281.

Date: 30.09.2002
Category: Financial limits, limitation proceedings and indemnification
Subject: Determination of the 1971 Fund's deductible under the terms of the insurance cover