Offshore and Renewable Energy Cover - General Exclusions

Performance and Contact Works
Offshore Cover is subject to the following standard exclusions
relating to performance of the work undertaken:

Failure to perform services (including specialist operations) under a contract.
Fitness for purpose and quality of the Member’s work, products and/or services,
Loss of or damage to contract works (unless a special extension of cover has been purchased by the member).

Pollution from Well or Hole
Offshore Cover excludes those liabilities, costs and expenses arising out of any pollution, including any clean-up costs, from the hole or well or reservoir which is or was being serviced by the entered vessel or is in the care, custody and control of the Member.

This exposure is generally covered by the operator of the well. Pollution arising from the normal operation of the vessel would however still be covered under standard cover.

Gross Negligence & Wilful Misconduct
Increasingly contractors are amending standard knock for knock contracts by inserting an exception to the operation of the clause where the liabilities and indemnities do not apply for claims that arise out of the gross negligence or wilful misconduct of a party causing loss.

The clause may further seek to exclude any contractual liability limits including those for consequential losses.

What amounts to gross negligence and wilful misconduct is often not defined and will be a matter of judgement (ultimately by a court) of the actions of the offending party and possibly the state of mind of the individuals concerned.

Ideally a contract should contain wording that clearly differentiates what conduct amounts to gross negligence from ordinary negligence.

Wilful misconduct by a controlling mind of the assured would be excluded from Offshore and Renewable Energy Cover pursuant to the Marine Insurance Act 1906.

Consequential Loss
Consequential losses such as loss of market unless such loss is recoverable at law and forms part of a covered claim.