International Group publishes a revised Agreement

Wednesday, 13th November 2019

Please note that following a meeting on 12 November 2019 the International Group has published new guidelines on the interpretation of the International Group Agreement together with a revised agreement. The key changes are:

1. For all Charterers’ business written from noon 20 February 2020 the IGA will not apply.
2. Clarification of ETC quotes: - New Clubs are free to match ETC quotes from Holding Clubs including any future distribution or return of funds, waiver or reduction of premium or other benefit that would have been provided by the Holding Club to or in respect of the vessel(s) if it/they had been or remained entered in the Holding Club, if and when any such benefit would have been made generally available to all mutual members entered in the Holding Club for the period of cover (the policy year or part policy year) to which the quoted ETC relates.
   The purpose of this wording is to clarify that matching is permitted if the capital distribution, waiver or other benefit is available only to Members of the Holding Club who renew their cover - in other words, only when the benefit is conditional upon renewal. In that case, the benefit lowers the actual cost of insurance for the period of cover. It can thus be matched by the New Club.
   BUT if the benefit would have been provided by the Holding Club anyway - regardless whether or not the Member renewed its entry - then it is an unconnected benefit, which the Holding Club pays independently of renewal. It cannot be said that this kind of benefit reduces the cost of insurance, since it is paid in any event, renewal or not. And because it has no relevance to renewal, the New Club cannot promise to match it as part of its quote for the entry.
3. There is an expedited dispute resolution procedure for any alleged breach of the IGA.
4. There is a shorter period for a Holding Club to provide records relating to a Member for which a quotation is being made by another Club together with clarification of the documents to be provided.
5. There is a reduced quoting restraint period under the IGA down to 12 months from the date of first entry of a vessel or a fleet.
6. There was perceived to be no need to amend the release call rules.