P. &. I Clubs Law and Practice
General Exceptions and Limitations to Club Cover
The Marine Insurance Act 1906 provides that in the case of certain perils and events an insurer will incur no liability should a loss be incurred by an assured resulting from such an event. An insurer will not be liable, for example, (i) for a loss not proximately caused by a peril insured against, nor (ii) for the wilful misconduct of the assured, nor (iii) for delay. Not all of the excepted perils in the 1906 Act are applicable to P&I Clubs but those that can be applied are applied by virtue of their incorporation into Club Rules. These usually contain a provision which, besides incorporating the Marine Insurance Act 1906 generally, also specifically incorporates the provisions of the 1906 Act relating to exceptions.1 Such a rule generally states that the rules and all contracts of insurance made by the club shall be subject to and incorporate the provisions of the 1906 Act except in so far as the Act is excluded by the rules or the contract of insurance between a member and the club.