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Swiss Re Engineering
Project Insurance Policy

Project Insurance Policy 2007

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Contents
Page

Principal Operative Clauses 4

Schedule 6
A. Insured 6
B. Project 6
C. Territorial Limits 7
D. Period of Insurance 7
E. Sums Insured Section 1, Material Damage 8
F. Limits of Liability Section 2, Third Party Liability 9
G. Sums Insured Section 3, Delay in Start-up 9
H. Deductibles 10
I. Progress Reports 11
J. Endorsements 11
K. Premium and Taxes 12
L. Applicable Law 12
M. Claims Notification 12

1 Section 1, Material Damage 13

1.1 Insuring Clause 13
1.2 Exclusions to Section 1 13
1.3 Conditions to Section 1 15
1.3.1 Basis of Indemnity 15
1.3.2 Maintenance Period 15
1.3.3 Removal of Debris 16
1.3.4 Professional Fees 16
1.3.5 Inland Transits 17
1.3.6 Off-site Storage 17
1.3.7 50/50 Sharing 18
1.3.8 Plans and Documents 18
1.3.9 Escalation 19
1.3.10 72 Hours Clause 19
1.3.11 Expediting Expenses 19
1.3.12 Insured Property Taken Over or Taken Into Use 20
1.3.13 Breach of Professional Duty 20
1.3.14 Error in Design and Manufacture 20

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2 Section 2, Third Party Liability 21
2.1 Insuring Clause 21
2.2 Exclusions to Section 2 22
2.3 Conditions to Section 2 23
2.3.1 Maintenance Period 23

3 Section 3, Delay in Start-up 24

3.1 Insuring Clause 24
3.2 Exclusions to Section 3 24
3.3 Conditions to Section 3 25
3.3.1 Basis of Indemnity 25
3.3.2 Period of Indemnity 26
3.3.3 Time Deductible 26
3.3.4 Progress Reports 26
3.3.5 Changes of the Principal’s Interest 26

4 General Exclusions 27
4.1 War and Allied Perils 27
4.2 Extended Nuclear Risks 27
4.3 Willful Acts and Gross Negligence 28
4.4 Terrorism 28

5 Special Conditions 29
5.1 Full Insurance 29
5.2 Suspension or Cessation of Work 29
5.3 Premium Adjustment 29

6 General Conditions 30
6.1 Unity of Policy 30
6.2 Due Observance of Policy Terms 30
6.3 Material Change 30
6.4 Reasonable Precautions 31
6.5 Access and Inspection 31
6.6 Claims 31
6.7 Subrogation 33
6.8 Mediation 33
6.9 Arbitration 34
6.10 Contribution 35
6.11 Applicable Law 35
6.12 Multiple Insured Cover 35

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Principal Operative Clauses

On basis of the underwriting information submitted by the Insured, the Insurers hereby
severally agree, each for their proportion set out herein, to indemnify the Insured in the
manner and to the extent hereinafter stated against loss, damage or liability occurring
during the Period of Insurance or any subsequent Period as may be mutually agreed
between the Insured and the Insurers, provided that:

(a) the amount payable by the Insurers shall not exceed the Sums Insured and Limits of
Liability set down in the Schedule and any Endorsement; and

(b) the amount payable by each of the Insurers individually shall be limited to the
proportion set against its name below; and

(c) the Insured shall bear, for their own account, the amounts set forth in the Schedule
or any Endorsement as the Deductibles.

In witness whereof, the undersigned, acting on behalf of and under the authority of each
of the Insurers respectively, have subscribed their names.

The Insurers

Name and Address of Insurer Reference Percentage Date Signature

Number Share of Policy
...............................................................
............................................................... .................. ...................... % ............. .......................
...............................................................
............................................................... .................. ...................... % ............. .......................
...............................................................
............................................................... .................. ...................... % ............. …………………..
...............................................................
............................................................... .................. ...................... % …………. .......................

100.00 %

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Premium Payment Warranty

The Insured warrant that the Premium stated below and any Premium as may be agreed by
Endorsement will be paid and received by Insurers on or before midnight of the respective
Due Date. If this warranty is not complied with, this Policy shall be terminated at such Due
Date.

Premium Payment Due Date Amount

Currency: ………….

100% or first instalment (as applicable) Inception Date ………………………….

………. instalment ……………………….. ………………………….

………. instalment ……………………….. ………………………….

………. instalment ……………………….. ………………………….

………. instalment ……………………….. ………………………….

Total Premium Sections 1, 2 and 3 (as applicable) ………………………….

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Schedule

A. Insured

For Sections 1, 2 and 3

Principal:

For Sections 1 and 2

Contractors:

Others:

For Section 3

Lenders:

B. Project

Contract:

Description of the Project:

Project Site:

Business of the Principal:

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C. Territorial Limits

D. Period of Insurance

Construction Period from ................................................................. being the Inception Date, to

................................................... being the Termination Date,
inclusive of Cold Testing (if any), and
inclusive of Hot Testing and Commissioning Period (if any) not exceeding …………weeks,
followed by ..................... months Maintenance Period (if any).

The Construction Period is inclusive of both Inception and Termination Dates.

The scheduled Date of Handover of the Insured Property to the Principal and the Anticipated
Date of Commencement of the Business shall occur on the Termination Date of the Construction
Period.

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E. Sums Insured Section 1, Material Damage

Currency:

Insured Property

(a) Total Contract Value

(b) Materials, services and labour supplied by the Principal

(a) + (b) Total Sum Insured at Inception Date

Automatic Escalation, in accordance with Condition 1.3.9: ..…….. %

Additional covers

Removal of Debris, in accordance with Condition 1.3.3:

Sum Insured in respect of each and every Loss

Professional Fees, in accordance with Condition 1.3.4:

Sum Insured in respect of each and every Loss

Inland Transits, in accordance with Condition 1.3.5:

Sum Insured in respect of each and every Loss

Off-site Storage, in accordance with Condition 1.3.6:

Sum Insured in respect of each and every Loss

Expediting Expenses, in accordance with Condition 1.3.11: ......... %

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F. Limits of Liability Section 2, Third Party Liability

Currency:
Limit of Liability payable to any one claimant or any number of
claimants consequent upon or attributable to one source or original
cause

Limit of Liability in the aggregate during the Period of Insurance

G. Sums Insured Section 3, Delay in Start-up

Currency:
(a) Debt Servicing Costs, i.e. the interest, scheduled principal
payments, fees and the like in respect of advances made
or monies borrowed by the Principal: Annual Sum Insured

(b) Fixed Costs, i.e. the fixed operation and management

costs and fees and costs for essential services: Annual Sum
Insured

(c) Net Profit: Annual Sum Insured

(a) + (b) + (c) Total Annual Sum Insured

Maximum Period of Indemnity: .......... months

Sum Insured for the Maximum Period of Indemnity

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H. Deductibles

Currency:

Section 1, Material Damage

In respect of each and every Loss:

• from storm, tempest, hurricane, cyclone, flood,
water damage, subsidence, landslip, avalanche

• from earthquake, volcanic activity and tsunami

• from all other perils other than during Hot Testing and
Commissioning and during Maintenance Period

• from all other perils during Hot Testing and

Commissioning

• during Maintenance Period

In the event that more than one Deductible applies the single largest shall apply.

Section 2, Third Party Liability

In respect of bodily injury or illness or death consequent upon or
attributable to one source or original cause

In respect of loss of or damage to physical property consequent

upon or attributable to one source or original cause

Section 3, Delay in Start-up

Time Deductible in the aggregate days

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I. Progress Reports

In accordance with Condition 3.3.4: interval ……………….months

J. Endorsements

No. Title

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K. Premium and Taxes

Currency:

Section 1, Material Damage

Section 2, Third Party Liability

Section 3, Delay in Start-up

Sections 1, 2 and 3

Taxes ................ %

Total Premium including Taxes

The Total Premium is adjustable in accordance with the terms of Special Condition 5.3. Further
Premium may be due by Endorsement.

L. Applicable Law

Applicable Law in accordance with General Condition 6.11:

M. Claims Notification

In accordance with General Condition 6.6, all potential claims under this Policy should
be notified to:

Telephone no.:

Fax no.:

E-mail:

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1 Section 1, Material Damage

1.1 Insuring Clause

Insurers hereby agree subject to the terms and conditions contained herein or
attached hereto or endorsed hereon that Insurers shall indemnify the Insured for
accidental physical loss or accidental material damage to the Insured Property,
hereafter termed Loss, which occurs during the Period of Insurance specified in the
Schedule or any subsequent Period as may be agreed by Endorsement.

1.2 Exclusions to Section 1

Insurers shall not be liable for:
(a) all costs rendered necessary by defects of material, workmanship, design, plan
or specification, being understood and agreed that:
(i) should Loss occur to any portion of the Insured Property containing any
of the said defects, the cost of replacement or rectification which is
hereby excluded is that cost which would have been incurred if
replacement or rectification of the Insured Property had been put in hand
immediately prior to the said Loss; and
(ii) for the purpose of this Policy and not merely this Exclusion, any portion
of the Insured Property shall not be regarded as lost or damaged solely
by virtue of the existence of any defect of material, workmanship,
design, plan or specification;

(b) any costs of replacing, repairing or rectifying any portion of the Insured Property
rendered necessary by wear and tear, corrosion, oxidation or deterioration, but
this exclusion shall not apply to insured Loss of other portions of the Insured
Property which is a result of such wear and tear, corrosion, oxidation or
deterioration;

(c) penalties or guarantees of performance and/or efficiency;

(d) consequential financial losses of any kind, loss of use;

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(e) any loss of accounts, bills, cash, currency, stamps, banknotes, evidences of
debt, deeds or securities;

(f) loss of any Insured Property arising from disappearance or shortage, discovered
only at the time of taking an inventory, unless such inventory is taken to confirm
an otherwise indemnifiable Loss hereunder;
(g) loss of or damage to any constructional plant and equipment used for the
execution of the Project, including machinery, tools, temporary buildings and
their contents;
(h) loss of or damage to any mechanically driven vehicle, licensed for use on a
public road;

(i) loss of or damage to any marine vessel or craft or aircraft;

(j) normal making good, normal upkeep;

(k) any loss of or damage to consumables, chemicals and feedstock;

(l) any loss of or damage to linings, including but not limited to refractory linings,
due to or arising from the direct application of heat;

(m) loss of or damage to any used or second hand machinery;

(n) loss of or damage to any offshore work;

(o) any loss resulting from directional drilling operations or other trenchless pipe
installation;

(p) any loss of or damage to material and equipment while in storage, due to or
arising directly or indirectly from water (other than flood or inundation), unless
material and equipment are stored in a waterproof building, or are protected by
a secure waterproof covering.

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1.3 Conditions to Section 1

1.3.1 Basis of Indemnity

In the event of insured Loss, the basis of indemnity shall be as follows:

a) in respect of Loss which can be repaired, the cost of repairs necessary to

restore the Insured Property to its condition immediately before the occurrence
of the Loss, less the value of any salvage;

b) in respect of total loss or destruction, the cost of reconstruction or replacement

of the Insured Property by property substantially the same as, but not better or
more extensive than that which was lost or destroyed, less the value of any
salvage.

If the anticipated cost of repairs equals or exceeds the cost of reconstruction or

replacement, the indemnity shall be as described in (b) above. The cost of any
temporary repairs will be borne by Insurers, provided such repairs do not increase the
total repair costs which would otherwise have been incurred.

Subject to General Condition 6.6, all repairs, reconstruction or replacement shall take
place with reasonable dispatch, and the costs recoverable shall be those actually
incurred, which shall be confirmed by the production of settled invoices, accounts or
other documents as may be required by the Insurers, together with justifiable
contributions towards overheads and net profit, both of which must be directly
relevant in the circumstances and agreed by the Insurers.

The cost of any alterations, additions or improvements shall not be recoverable under
this Policy.

1.3.2 Maintenance Period

This Policy does not cover loss of or damage to Insured Property, occurring or arising
during the Maintenance Period, except when insured Loss is:

(a) arising from a cause occurring on the Project Site during the Construction
Period; or

(b) caused by an insured Contractor in the course of any operations carried out by
him for the purpose of complying with his obligations under the defects liability
clauses of the Contract.

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However, the cover provided by this Policy shall not include loss or damage caused by
or arising out of actions or omissions of an insured Contractor in connection with
training, supervision, instruction or normal upkeep and plant management duties
during the operation of the Business of the Principal.

1.3.3 Removal of Debris

This Section will indemnify the Insured, up to the Sum Insured specified in the
Schedule, for the costs and expenses necessarily and reasonably incurred in the
removal and disposal of the debris of Insured Property provided such debris are
resulting from an insured Loss.

1.3.4 Professional Fees

This Section will indemnify the Insured, up to the Sum Insured specified in the
Schedule, in respect of architects, surveyors, consulting engineers and other
professional fees, necessarily and reasonably incurred in the repair, reconstruction or
replacement consequent to insured Loss, provided that:

(a) fees for preparing any claim under this Policy are excluded hereby; and

(b) the amount payable under the terms of this Section shall not exceed the scale of
fees in normal use by such professions.

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1.3.5 Inland Transits
This Section will indemnify the Insured, up to the Sum Insured specified in the
Schedule, in respect of insured Loss, while Insured Property is being transported on
any vehicle (including loading and unloading) to the Project Site or to temporary off-
site facilities, provided that:

(a) said Insured Property is owned, or is in the custody, care or control of the
Insured; and

(b) the transits insurance hereunder shall only indemnify the Insured to the extent
that the Loss is not recoverable under any other insurance; and

(c) such transits take place within the Territorial Limits.

Such cover does not apply during marine or air transit but shall include transits by
roll-on roll-off ferry when a bill of lading is not issued.

1.3.6 Off-site Storage

This Section will indemnify the Insured, up to the Sum Insured specified in the
Schedule, in respect of insured Loss, while Insured Property is in temporary storage
off the Project Site, except while at any manufacturers or suppliers premises prior to
delivery to the Project Site, provided that:

(a) said Insured Property is owned, or is in the custody, care or control of the
Insured; and

(b) the storage area is fenced and guarded; and

(c) the off-site storage insurance hereunder shall only indemnify the Insured to the
extent that such Loss is not recoverable under any other insurance; and

(d) such off-site storage takes place within the Territorial Limits.

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1.3.7 50/50 Sharing
In the event of loss or damage being discovered after the cover provided for any item
of Insured Property under any marine or transit policy of insurance has terminated
and if after proper investigation it is not possible to ascertain whether such loss or
damage happened prior to termination of such policy, Insurers shall indemnify the
Insured in respect of insured Loss, provided that:

(a) immediately upon delivery to the Project Site Insured Property shall be
externally inspected for any damage; and

(b) the indemnity under this condition shall not exceed 50% of the properly
adjusted claim, such payment to be without prejudice to any subsequent final
claim apportionment which may be mutually agreed between the respective
Insurers; and

(c) the Deductible stated in the Schedule shall be applied in the same way as the
indemnity provided.

1.3.8 Plans and Documents

In the event of insured Loss to plans, drawings, files, documents, manuscripts, or
computer system records forming part of the Insured Property, this Section shall
indemnify the Insured in respect of the cost of labour and computer time expended in
reproducing such plans, drawings, files, documents, manuscripts, or computer system
records, including any expenses incurred in producing the information contained
thereon, provided that:

(a) the Insured shall keep up to date backup records of such plans, drawings,
documents, manuscripts or computer system records in a remote and secure
location; and

(b) the insurance hereunder shall not include any loss or damage suffered by the
Insured due to the distortion or non availability of such information; and

(c) the indemnity hereunder shall not exceed in respect of any one Loss and in the
aggregate 1 percent of the Total Sum Insured specified in the Schedule.

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1.3.9 Escalation
If during the Construction Period the actual value of the Insured Property shall exceed
the Total Sum Insured as specified in the Schedule, the Total Sum Insured shall be
increased automatically so that it is equal to such actual value, subject, however, to
the increase not exceeding in any case the automatic escalation percentage indicated
in the Schedule. Where it is apparent, or should be reasonably apparent, to the
Insured that the automatic escalation percentage will be exceeded, the Insured must
advise Insurers immediately so that Insurers can concur with such revisions at terms
and conditions to be agreed, subject to General Condition 6.3.

1.3.10 72 Hours Clause

Any Loss arising during any one period of 72 hours caused by storm, tempest, flood,
water or cyclone shall be deemed to be one Loss.

The Insured shall select the time from which any such period shall commence but no
two selected periods shall overlap.

1.3.11 Expediting Expenses

This Section will indemnify the Insured, in respect of the difference in costs between
those calculated at normal or standard rates of reimbursement, and those actually
incurred including costs for overtime, work on public holidays and weekends, shift
working and express freight provided that such costs:

(a) are necessarily and reasonably incurred by the Insured for the purpose of
preventing or minimising any delay in completion of the Project solely due to
insured Loss; and

(b) shall not include any costs for air freight; and

(c) shall not exceed the percentage, as specified in the Schedule, of the costs
which would have been indemnified had this Condition not applied.

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1.3.12 Insured Property Taken Over or Taken Into Use
In the event of any part of the Insured Property being taken over by the Principal or
taken into use, the Construction Period, in respect of such part of Insured Property,
will be deemed to have come to an end and the Maintenance Period (if applicable) to
have commenced on the date of such taking over or taking into use.

This condition shall not apply to any part of Insured Property whilst being used by any
Contractor as a facility for the execution of any other part of the Project, always
provided that it is not operated or used for commercial purposes.

1.3.13 Breach of Professional Duty

In the event of a claim being brought by any Insured in respect of Loss resulting from
any breach of professional duty by professional consultants, the Insurers will
indemnify the Insured, in accordance with Condition 1.1. However, the Insurers retain
all rights of subrogation against the professional consultants in respect of such Loss.

1.3.14 Error in Design and Manufacture

In the event of a claim being brought by any Insured in respect of Loss resulting from
neglect, error or omission in the design or manufacture of component products by any
supplier, the Insurers will indemnify the Insured in accordance with Condition 1.1.
However, the Insurers retain all rights of subrogation against the supplier in respect
of such Loss.

For the purpose of this exclusion, the term component products shall mean items
manufactured or assembled at a factory location away from the Project Site.

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2 Section 2, Third Party Liability

2.1 Insuring Clause

Insurers hereby agree, subject to the terms and conditions contained herein or
attached hereto or endorsed hereon, that Insurers shall indemnify the Insured against
all sums which the Insured shall become legally liable to pay for damages, hereafter
termed Liability, in respect of:

(a) accidental bodily injury or illness or death of a third party; or

(b) accidental loss or damage to property belonging to third parties,

arising out of the execution of the Project and occurring at the Project Site during the
Period of Insurance specified in the Schedule or any subsequent Period as may be
agreed by Endorsement.

Insurers will also pay, in respect of any claim which may be the subject of indemnity
under this Section:

(i) all legal costs and expenses recovered by any claimant from the Insured but
only where the handling of the claim has been agreed in written form by the
Insurers; and

(ii) all legal costs and expenses incurred by the Insured with the written consent of
Insurers.

Insurers may, at any time, pay to the Insured the applicable Limit of Liability (after
deduction of any sum already paid) or any lesser amount for which any claim or
claims can be settled. Upon such payment, Insurers shall relinquish the conduct and
control of and be under no further liability under this Section in connection with such
claim or claims except for legal costs and expenses recoverable from the Insured by
any claimant or costs and expenses incurred with the written consent of Insurers in
respect of matters prior to the date of such payment.

The total liability of Insurers under this Section, inclusive of legal costs and expenses,
shall not exceed the Limits of Liability stated in the Schedule.

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2.2 Exclusions to Section 2
Insurers will not indemnify the Insured in respect of:

(a) any liability resulting from bodily injury, illness or death of an individual arising
from or in the course of their employment by the Insured under a contract of
labour, service or apprenticeship;

(b) any liability insurable under Employer’s Liability insurance or liability for
accidents insurable under Workmen Compensation insurance;

(c) any liability compulsorily insurable under any legislation governing the use of
motor vehicles;

(d) any liability resulting from, attributable to or caused by the ownership or

possession of or use by or on behalf of the Insured of:
(i) any mechanically driven vehicle except when such vehicle is on the
Project Site and is not insured under a specific motor vehicle or any other
insurance policy; or
(ii) any water-borne vessel or craft or any aircraft;

(e) any liability caused by or arising from pollution or contamination of buildings,

other property, water, land or the atmosphere, unless the pollution or
contamination is caused by a sudden identifiable unintended and unexpected
accident which takes place in its entirety at a specific moment during the Period
of Insurance;

(f) any liability for the cost of repairing, replacing or making good any loss of or
damage to:
(i) the Insured Property;
(ii) mobile and stationary constructional plant, machinery, equipment, tools,
temporary buildings and their contents;
(iii) any property belonging to or in the care, custody or control of any of the
insured parties;

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(g) liability for any consequential financial loss directly or indirectly sustained by
any party, irrespective of whether or not insured hereunder, due to or arising
from loss or damage to:
(i) the Insured Property;
(ii) mobile and stationary constructional plant, machinery, equipment, tools,
temporary buildings and their contents;

(h) any liability arising under penalty or liquidated damages clauses in any contract,
or any punitive or exemplary damages;

(i) any liability assumed under contract which imposes upon the Insured liability
which would not otherwise have been incurred by the Insured;

(j) any liability arising out of technical or professional advice given by the Insured
or by any person acting on behalf of the Insured;

(k) any liability (other than accidental bodily injury or death of any person) due to or
arising from loss of or damage to property caused by subsidence, vibration or
the weakening or removal of support;

(l) any liability insurable under Product Liability insurance;

(m) any actual or alleged liability whatsoever for any claim in respect of loss directly
or indirectly arising out of, resulting from or in consequence of asbestos, in
whatever form or quantity.

2.3 Conditions to Section 2

2.3.1 Maintenance Period

This Policy does not cover bodily injury, illness, death or loss or damage, occurring or
arising during the Maintenance Period, except Liability caused by an insured
Contractor in the course of any operations carried out by him for the purpose of
complying with his obligations under the defects liability clauses of the Contract.

However, the cover provided by this Condition shall not include any liability arising
out of actions or omissions of an insured Contractor in connection with training,
supervision, instruction or normal upkeep and plant management duties during the
operation of the Business of the Principal.

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3 Section 3, Delay in Start-up

3.1 Insuring Clause

Insurers hereby agree, subject to the terms and conditions contained herein or
attached hereto or endorsed hereon that Insurers shall indemnify the Insured for the
actual loss sustained as a result of delay beyond the Anticipated Date of
Commencement of the Business, hereafter termed Delay in Start-up, provided that the
Delay in Start-up is solely caused by one or more interference(s) with the progress of
the Project caused by Loss occurring during the Construction Period and insured
under Section 1, Material Damage.

3.2 Exclusions to Section 3

Insurers shall not be liable for:

(a) any delay caused by or resulting from:

(i) loss of or damage to mobile and stationary constructional plant,
machinery, equipment, tools, temporary buildings and their contents;
(ii) damage to Existing Property;
(iii) loss of or damage to property held in the care, custody or control of the
Insured;
(iv) loss of operating media or feedstock;
(v) shortage, destruction, deterioration of or damage to any materials
necessary for the Business of the Principal;
(vi) any condition or restriction imposed by a public authority;
(vii) loss of or damage to Insured Property or any part thereof taken over by the
Principal;
(viii) non-availability of funds;
(ix) alterations, additions, improvements, rectification of defects or faults or
elimination of any deficiencies;

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(b) loss of business due to suspension, lapse or cancellation of lease, licence or
order, unless
(i) it occurs before the date of actual commencement of the Business of the
Principal; and
(ii) it is the direct consequence of the Delay in Start-up;

(c) penalties or damages of whatever nature for breach of contract or for late or
non-completion of orders;

(d) from Third Party Liability claims.

3.3 Conditions to Section 3

3.3.1 Basis of Indemnity

The amount payable as indemnity under Section 3 shall be:

(a) the amount obtained by multiplying the percentage by which the actual turnover
during the Period of Indemnity falls short of the turnover which would have
been achieved had the Delay in Start-up not occurred, by the amount of the
Debt Servicing Costs and/or the Fixed Costs that would have been payable
and/or the Net Profit that would have been earned out of the revenue had the
Delay in Start-up not occurred; and/or

(b) the Increased Cost of Working being defined as any additional expenditures
necessarily and reasonably incurred with the prior consent of Insurers, by the
Insured or any other party on his behalf, for the sole purpose of avoiding or
diminishing the amount which Insurers would have been liable to pay under (a)
above, but not exceeding the sum by which the amount otherwise payable is
reduced;

(c) less any amount contractually or legally recoverable by the Insured under the
form of liquidated damages or penalties or any other sum saved during the
Period of Indemnity in consequence of the Delay in Start-up.

The amount payable shall be deemed, as the lowest amount corresponding

to (a) or (b) or a combination thereof, after application of (c) and shall not
exceed the Annual Sum Insured specified in the Schedule calculated pro rata
temporis for the Period of Indemnity.

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3.3.2 Period of Indemnity
The Period of Indemnity begins with the date upon which, had the Delay in
Start-up not occurred, the Business of the Principal would have commenced,
but not prior to the Anticipated Commencement Date of the Business, and
ends with the actual date the Business commences.

The Period of Indemnity shall not exceed the length of time it takes with the
exercise of due diligence and dispatch to repair, reconstruct or replace such
part of the Insured Property which has been lost or damaged or the
Maximum Period of Indemnity stated in the Schedule, whichever shall be
shorter.

The Business of the Principal shall be deemed to have commenced on the

date of the Certificate of Practical Completion, or upon handover to the
Principal, or the taking over by the Principal of the Project or of any part
thereof which shall be capable (at that date) of earning revenues, whichever
shall occur first.

3.3.3 Time Deductible

The monetary amount corresponding to the Time Deductible shall be
calculated by multiplying the average daily value of loss sustained during the
Period of Indemnity by the number of days agreed upon as the Time
Deductible and shall be deducted from the amount payable.

3.3.4 Progress Reports

The Insured shall submit Progress Reports to the Insurers at the intervals
stated in the Schedule. Each such report shall be submitted within 14 days of
the end of the period which it relates to. Reasons for any delay that has
occurred since the last report shall be advised, together with the latest
revised construction programme.

3.3.5 Changes of the Principal’s Interest

This Section shall be voided if the Business of the Principal be wound up or
carried on by a liquidator or receiver or be permanently discontinued or the
Principal’s interest ceases.

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4 General Exclusions

4.1 War and Allied Perils

This Policy does not cover any loss, damage or liability occasioned by or through or in
consequence, directly or indirectly, of any of the following events, namely:

(a) war, invasion, act of foreign enemy, hostilities or warlike operations (whether
war is declared or not), civil war;

(b) mutiny, military rising, insurrection, rebellion, revolution, military or usurped

power, martial law or state of siege, nationalisation, confiscation, requisition,
seizure or loss of or damage to property by order of the government or by any
public authority;

(c) strike, riot, civil commotion and popular rising.

In any action, suit or other proceedings where Insurers allege that, by reasons of the
provisions of this Exclusion, any loss, damage or liability are not covered by this
Policy, the burden of proving that such loss, damage or liability are covered shall be
upon the Insured.

4.2 Extended Nuclear Risks

This Policy does not cover any loss, damage or liability occasioned by or through or in
consequence, directly or indirectly, of any of the following events, namely:

(a) ionising radiations from or contamination by radioactivity from any nuclear fuel
or from any nuclear waste or from the combustion of nuclear fuel;

(b) the radioactive, toxic, explosive or other hazardous or contaminating properties

of any nuclear installation, reactor or other nuclear assembly or nuclear
component thereof;

(c) any weapon or device employing atomic or nuclear fission and/or fusion or
other like reaction or radioactive force or matter;

(d) the radioactive, toxic, explosive or other hazardous or contaminating properties

of any radioactive matter, but the exclusion in this subclause does not extend to
radioactive isotopes, other than nuclear fuel, when such isotopes are being
prepared, carried, stored, or used for commercial, agricultural, medical,

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scientific or other similar peaceful purposes;

(e) any nuclear reaction, nuclear radiation or radioactive contamination regardless

of any other cause contributing concurrently or in any other sequence to any
loss, damage or liability;

(f) any chemical, biological, bio-chemical or electromagnetic weapon.

4.3 Willful Acts and Gross Negligence

This Policy does not cover any loss, damage or liability directly or indirectly caused by
or arising from or aggravated by any wilful act or omission or gross negligence of the
Insured or their management, including but not limited to the Project manager and
the Project Site manager.

4.4 Terrorism
This policy does not cover any loss, damage or liability of whatsoever nature directly
or indirectly caused by, resulting from, happening through, arising out of or in
connection with any act of terrorism, regardless of any other cause contributing
concurrently or in any other sequence to the loss, damage or liability.

For the purpose of this exclusion, terrorism means an act or threat of violence or an
act harmful to human life, tangible or intangible property or infrastructure with the
intention or effect of influencing any government or of putting the public or any
section of the public in fear.

In any action suit or other proceedings where the Insurers allege that by reason of
this definition a loss, damage or liability is not covered by this Policy, the burden of
proving that such loss, damage or liability is covered shall be upon the Insured.

In the event any portion of this clause is found to be invalid or unenforceable, the
remainder shall remain in full force and effect.

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5 Special Conditions

5.1 Full Insurance

If it is found, in the event of Loss or Delay in Start-up, that any actual Sum Insured is
less than the Sum Insured which would correspond to the definition provided in the
Schedule, in any Condition and/or Endorsement, then the amount recoverable by the
Insured shall be reduced in such proportion as the actual Sum Insured bears to the
respective Sum Insured which would correspond to the definition. Each item specified
in the Schedule or any Endorsement is separately subject to this condition.

5.2 Suspension or Cessation of Work

In the event of any partial or total unscheduled suspension or cessation of work, the
Insured shall give immediate notice in writing to Insurers if such a suspension or
cessation is anticipated to exceed 30 calendar days. Any such suspension or
cessation shall be considered as a Material Change as per General Condition

5.3 Premium Adjustment

The Premium charged for Section 1, Material Damage and Section 2, Third Party
Liability is the Premium based upon the Total Sum Insured at Inception Date as
stated in the Schedule under Insured Property.

If at any time during the Construction Period, the value of Insured Property, which
would correspond to the definition provided in the Schedule, is higher than the Total
Sum Insured stated in the Schedule, increased by the provisions of Condition 1.3.9,
the Insured shall declare the amount of such value to Insurers and shall supply any
other information that Insurers may reasonably require so that, subject to Condition
6.3, the Premium hereon shall be appropriately adjusted.

At the termination of the Construction Period, the Insured shall declare the amount of
the final Total Contract Value to Insurers, plus (if applicable) the final value of the
materials, services and labour supplied by the Principal, such value being the Final
Total Value of Insured Property, and shall supply any other information that Insurers
may reasonably require. Should the Final Total Value be higher than the Total Sum
Insured at Inception Date, the Premium due for Sections 1 and 2 shall be increased
proportionally and the Insured shall pay the difference between such Premium and
the Premium already paid.

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6 General Conditions

6.1 Unity of Policy

The Schedule, Sections, Special Conditions, General Exclusions, General Conditions,
Endorsements and any other terms herein are deemed to be integral parts of this
Policy, and any word or expression to which a specific meaning has been attached in
any part shall bear such meaning wherever it may appear.

6.2 Due Observance of Policy Terms

The due observance and fulfilment of the terms of this Policy insofar as they relate to
anything to be done or complied with by the Insured shall be a condition precedent to
any liability of Insurers.

6.3 Material Change

If at any time any change shall occur materially varying any of the facts relating to the
Project, the Contract, this Policy or the degree of risk assumed hereunder, the Insured
shall immediately give notice in writing of such Material Change in risk to the
Insurers, supplying, as soon as possible thereafter, any further particulars as the
Insurers may reasonably require.

In the event of a Material Change in risk, the continuance of this insurance shall be at
terms and conditions to be agreed, in writing, between the Insured and the Insurers,
but should the parties be unable to agree to the new terms and conditions within 30
days of the Insurers initially advising the Insured of their requirements, any
indemnifiable Loss, Liability or Delay in Start-up shall be covered only to the extent it
would have been covered had the Material Change not occurred.

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6.4 Reasonable Precautions
The Insured shall take and cause to be taken at his own expense for the full Period of
Insurance all reasonable precautions for the safety of persons and property and the
prevention of loss or damage, delay, bodily injury, illness and death, which might give
rise to a claim under this Policy. The Insured shall, in particular, take care in the
selection of labour, comply with best industry practice, statutory requirements and
manufacturers’ recommendations and take action to maintain all plant and equipment
in good working condition.

6.5 Access and Inspection

Representatives of Insurers shall, at any reasonable time, have the right to inspect
and examine all or any part of the Insured Property on the Project Site or in any off-
site storage insured hereunder. In addition, the representatives shall be provided by
the Insured with any other information or document pertaining to the Project,
including independent engineering reports, as may be reasonably requested by
Insurers.

6.6 Claims
In the event of any loss or damage, delay, or third party claim, which might give rise to
a claim under this Policy, the Insured shall:

(a) immediately notify Insurers by telephone or email via the address specified in
the Schedule, giving an indication as to the nature and extent of the loss or
damage, delay or third party claim and confirm such advice in writing as soon as
possible;

(b) supply as soon as possible all such information and documentary evidence in
relation to the claim as Insurers may require;

(c) preserve anything that might prove necessary or useful by way of evidence in
connection with any claim and make it available for inspection by a
representative of Insurers;

(d) send to Insurers, immediately after receipt, any writ, summons or other
proceedings which may be commenced against the Insured;

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(e) inform the police authorities promptly in the event of loss or damage by theft,
burglary or any malicious person;

(f) take at his own expense such immediate action, do and concur in doing
and permit to be done all things which may be reasonably practicable
to minimise or to avoid or diminish any claim, and to prevent any
repetition in that or any other part of the Insured Property;

(g) give to Insurers every assistance to enable the Insurers to adjust, settle or resist
any claim against the Insured, or institute any proceedings;

(h) advise Insurers of any other insurance which may cover any loss or damage,
delay or third party claim, or any part thereof, which has been notified under
this Policy;

In the event of any delay giving rise or likely to give rise to a claim under Section 3,
Delay in Start-up, the Insured shall:
(i) comply with condition (c) above as far as may be reasonably practicable
without causing any increase in the period of interruption or interference;
(ii) allow Insurers and every person authorised by Insurers to contact directly any
Insured under Section 1, Material Damage in order to establish the cause and
probable extent of the interruption or interference and its effect and, if
necessary, to make any reasonable recommendations for the avoidance or
minimisation of the Delay in Start-up.

The Insured shall not be entitled to abandon any property to the Insurers.

In respect of claims under Sections 1, Material Damage and Section 3, Delay in Start-
up, Insurers shall not be liable for any loss or damage for which no notice has been
received by Insurers within 14 days of the occurrence of Loss.

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In respect of claims under Section 2, Third Party Liability, Insurers will not indemnify
the Insured for liability for which no notice has been received by Insurers within 6
months of the expiry of the Insurance Period.

If a claim is made and rejected, which means that the liability under this Policy is
declined in writing by the Insurers, and no reference to mediation is commenced by
the Insured within three months after such rejection, then, for all purposes, the claim
shall be regarded as having been abandoned and shall not be recoverable under this
Policy.

6.7 Subrogation
The Insured shall, at the expense of Insurers, do and concur in doing and permit to be
done, all such acts and things as may be necessary or reasonably required by the
Insurers for the purpose of enforcing any rights and remedies or of obtaining relief or
indemnity from other parties to which Insurers shall be or would become entitled or
subrogated, upon their paying for or making good any Loss, Delay in Start-up or
Liability, whether such acts and things shall be or become necessary or required
before or after the Insured's indemnification by Insurers.

6.8 Mediation
If any dispute or difference of whatsoever nature arises out of or in connection with
this Policy, including any question regarding its existence, validity or termination,
hereafter termed as Dispute, the parties undertake that, prior to a reference to
arbitration in accordance with Condition 6.9, they will seek to have the Dispute
resolved amicably by mediation.

All rights of the parties in respect of the Dispute are and shall remain fully reserved
and the entire mediation including all documents produced or to which reference is
made, discussions and oral presentations shall be strictly confidential to the parties
and shall be conducted on the same basis as without prejudice negotiations,
privileged, inadmissible, not subject to disclosure in any other proceedings
whatsoever and shall not constitute any waiver of privilege whether between the
parties or between either of them and a third party.

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The mediation may be terminated should any party so wish by written notice to the
appointed mediator and to the other party to that effect. Notice to terminate may be
served at any time after the first meeting or discussion has taken place in the
mediation.

If the Dispute has not been resolved to the satisfaction of either party within 90 days
of service of the notice initiating mediation, or if either party fails or refuses to
participate in the mediation, or if either party serves written notice terminating the
mediation under this clause, then either party may refer the Dispute to arbitration in
accordance with Condition 6.9.

Unless the parties otherwise agree, the fees and expenses of the mediator and all
other costs of the mediation shall be borne equally by the parties and each party shall
bear their own respective costs incurred in the mediation regardless of the outcome
of the mediation.

6.9 Arbitration
Subject to Condition 6.8, any Dispute shall be referred to an arbitrator appointed by
the parties.

In the absence of any such statutory provisions, and unless the parties agree upon a
single arbitrator within thirty days of one receiving a written request from the other
for arbitration, the claimant shall appoint his arbitrator and give written notice thereof
to the respondent. Within thirty days of receiving such notice, the respondent shall
appoint his arbitrator and give written notice thereof to the claimant, failing which,
the claimant may apply to the appointer, hereinafter named, to nominate an arbitrator
on behalf of the respondent.

Before entering upon the reference, the two arbitrators shall appoint a third
arbitrator, but should they fail to do so within thirty days of the appointment of the
respondent's arbitrator, then either of them, or either of the parties, may apply to the
appointer for the appointment of the third arbitrator. The appointer shall be the
Chairman, for the time being, of AIDA Reinsurance and Insurance Arbitration Society
of the UK (ARIAS), c/o The International Underwriting Association, 3 Minster Court,
London EC3R 7DD. The three arbitrators shall decide by a majority, but if no majority
can be reached, the verdict of the third arbitrator shall prevail. The third arbitrator
shall also act as the chairman.

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Unless the parties agree otherwise, the arbitration tribunal shall consist of persons
with no less than ten years experience in international insurance business, having
been engaged in such business or in advising on such business in a professional
capacity.

The arbitrator(s) shall have power to set all procedural rules for the holding of the
arbitration, and all costs of the arbitration shall be paid by the parties and in the
manner as directed by the arbitrator(s). The award of the arbitrator(s) shall be given in
writing, with reasons, and both parties hereby agree to be bound by the award given
in accordance with the above provisions.

The seat of the arbitration shall be in the capital city of the country or state of the Law
specified in the Schedule.

This condition remains valid, should the Policy become void.

6.10 Contribution
This Policy is not to be called upon in contribution and is only to pay any Loss, Delay
in Start-up or Liability if and so far as not recoverable under any other insurance
policy.

6.11 Applicable Law

The construction validity and performance of this Policy shall be in all respects
governed exclusively by and interpreted in accordance with the Law specified in the
Schedule.

6.12 Multiple Insured Cover

(a) It is noticed and agreed that if the Insured described in the Schedule comprises
more than one insured party each operating as a separate and distinct entity,
then (save as provided in this Multiple Insured Clause) cover hereunder shall
apply in the same manner and to the same extent as if individual policies had
been issued to each such insured party provided that the total liability of the
Insurers to all of the insured parties collectively shall not exceed the Sums
Insured and Limits of Indemnity including any inner limits set by Condition or

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Endorsement stated in the Policy.

(b) It is understood and agreed that any payment or payments by Insurers to any
one or more such insured parties shall reduce, to the extent of that payment,
Insurers’ liability to all such parties arising from any one event, giving rise to a
claim under this Policy and (if applicable) in the aggregate.

(c) It is further understood that the insured parties will at all times preserve the
various contractual rights and agreements entered into by the insured parties
and the contractual remedies of such parties in the event of Loss, Liability or
Delay in Start-up.

(d) It is further understood and agreed that Insurers shall be entitled to avoid
liability to or (as may be appropriate) claim damages from any of the insured
parties in circumstances of fraud, material misrepresentation, material non-
disclosure or breach of any warranty or condition of this Policy by such insured
party each referred to in this clause as a Vitiating Act. In circumstances of fraud,
material mis-representation, material non-disclosure or breach of any warranty
of this Policy, it shall be void ab initio but only for the insured party who has
committed the aforementioned act.

(e) It is however agreed that (save as provided in this Multiple Insured clause), a
Vitiating Act committed by one insured party shall not prejudice the right to
indemnity of any other insured party who has an insurable interest and who has
not committed a Vitiating Act.

(f) Insurers hereby agree to waive all rights of subrogation, which they may have or
acquire, against any insured party, except where such rights are either expressly
provided for in this Policy or by Endorsement or are acquired in consequence of
or otherwise following a Vitiating Act, in which circumstances Insurers may
enforce such rights notwithstanding the continuing or former status of the
vitiating party as an Insured.

(g) In the event that the Lenders to the Project are included in the Schedule, they
shall not be entitled to any indemnity under this Policy for or arising from Loss,
Liability or Delay in Start-up in respect of which Insurers are, by reason of a
Vitiating Act, no longer liable to indemnify any one or more other insured party.

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