Dublin International Marine Claims Conference - 29th September / 1st October 2004 INTERNATIONAL MARINE CLAIMS CONFERENCE CLAIMS HANDLING FRENCH MARKET PRACTICE INTERNATIONAL MARINE CLAIMS CONFERENCE CLAIMS HANDLING FRENCH MARKET PRACTICE

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  INTRODUCTION : FUNDAMENTALS  1 – Notification of claims  2 – Leading Insurer response  3 – Appointment of Surveyors  4 – Appointment of Lawyers  5 – Issuing guarantees/counter guarantees  6 – Co-insurers  7 – Settlement of claims SUMMARY

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004 FRENCH MARINE CLAIMS HANDLING FUNDAMENTALS  French H. & M. General Conditions are “All Risks” policy: burden of proving does not lie with the Assured. On the contrary, it is up to the Insurance Company to prove that the case is not covered  As a consequence, Loss Adjustment is made by Leading Insurers which have developed in-house expertise in marine claims practice with lawyers and master mariners  Today’s practice is that Leading insurers are directly handling H. & M. claims and servicing the Assureds in the same way whatever the insurance conditions may be.

Dublin International Marine Claims Conference - 29th Septembre / 1st October Notification of Claims  Normal practice: claims notified through Broker to Leading Insurer  Emergency cases and outside working hours cases:  Claims notified by Ship Owners direct to Leading Insurer  24 hours emergency phone numbers  Dedicated crisis management organizations: set up by each Leading Insurer to resolve rapidly and efficiently complex technical and legal issues raised by large marine claims  Texte Texte  Texte

Dublin International Marine Claims Conference - 29th Septembre / 1st October Leading Insurer response (1)  Normal practice  Acknowledges receipt and notify name of claims handler  Check whether surveyor has been already appointed or, if not, appoints surveyor and issues instructions  Raises estimates for indemnity and costs, on the basis of information provided by Assured/Broker or, if not available or not sufficiently accurate, determines estimates with the assistance of in-house Master Mariners

Dublin International Marine Claims Conference - 29th Septembre / 1st October Leading Insurer response (2)  Emergency cases (fire, collision, grounding …): In addition to the above, Leading Insurer may:  Take appropriate measures to minimize loss, protect rights, safeguard Assureds’/his interests  If applicable, assist the Ship Owner or directly concludes L.O.F. / contracts of towage, discuss and issue salvage guarantees  In collision cases, take care of discussing liabilities and guarantees, either directly or with the P. & I. Club if applicable, issue guarantees or counter-guarantees

Dublin International Marine Claims Conference - 29th Septembre / 1st October Appointment of Surveyors (1)  French Market central organization CESAM is in charge of monitoring a worldwide surveyors network on behalf of the French Marine insurers who use this network in normal circumstances  CESAM is in charge of leading this network, in terms of expertise and quality of service, and in terms of fees, with the input of each individual Insurance Company and Broker  If no CESAM local surveyor with appropriate expertise is available, other surveyors may be appointed but always selected or ratified by the leading underwriter  If required by assured, surveyors outside CESAM network may be agreed in the insurance policy

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  Instructions to surveyors include:  Vessel’s particulars, including class and other certifications status  Circumstances of loss  Nature, extent and causes of loss  Repair costs  If applicable, investigations as to any third party potential liability in the casualty  but never adjustment of claims or any advice on contract of insurance clauses 3 - Appointment of Surveyors (2)

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  If practicable and except for recovery actions, first choice left to assured, but always ratified by insurers  Selection always made in accordance with following criteria:  Expertise (Knowledge of local/applicable law, specialist in relevant fields …)  Level of fees  Insurance companies may have special agreements with selected lawyers essentially providing for scale of fees  As a general rule, precise instructions are given by insurance companies which always want to ratify decisions/courses of action and to closely monitor fees and expenses 4 – Appointment of Lawyers

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  Salvage and collision cases (4/4 th cover): whenever accepted, guarantees issued by Leading Insurer, on 100 % basis, subject to financial strength of co-insurers, with counter-guarantees from co-insurers  Salvage: Some Insurance Companies have special agreements with selected salvors providing for standard wording and quick issuance of letters of guarantees, rapid settlements and easy disputes resolution 5 - Issuing guarantees / counter guarantees

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  New claims with initial estimates, as well as subsequent movements of reserves and payments are notified immediately by Leading Insurers through electronic data transmission for all French Market Insurers and through the Brokers for Foreign Markets Insurers. 6 - Co-insurers (1)

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  Protocols signed by Marine Insurance companies through French Insurance Companies Association (F.F.S.A.) concerns:  Central co-insurance management covering:  Central accounting system (Optiflux) involving also Brokers and Underwriting Agents  Central electronic data exchange system  Claims Handling Scheme governing rules of charging fees and compensating costs for claims handling and recoveries by Leading Insurers 6 - Co-insurers (2)

Dublin International Marine Claims Conference - 29th Septembre / 1st October 2004  Adjustments prepared by Leading Insurers and submitted to Assureds before payment  Payment to Brokers through Central accounting system (Optiflux). Direct payment to Assureds or to third parties (shipyards …etc) always possible.  7 – Settlement of claims