War, Terrorism and Political Violence Insurance

Policy wording

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 War, Terrorism and Political Violence Insurance
Policy wording

Some of the words we use have a special meaning in this policy. If a word is in bold type,
please read the definitions section and the policy schedule.

Cover and location This insurance covers the insured property while at the named location(s) specified in the
policy schedule against physical loss or physical damage, occurring during the period of
insurance, directly caused by:
i. an act of terrorism and/or sabotage;

ii. malicious damage;

iii. riots, strikes, civil commotion;

iv. invasion, acts of foreign enemies, hostilities (whether war be declared or not) civil war,
rebellion, revolution, coup d’etat, insurrection or mutiny; or
v. war;

subject to the following terms, conditions and exclusions.

Basis of settlement The basis upon which a claim will be settled is as follows:
A. In respect of buildings damaged we shall pay you:
The lesser of the reasonable cost of rebuilding or repairing, which may be carried out upon
another site within the country where the building is located subject to our liability not
being increased, to a condition substantially the same as but not better or more extensive
than the condition of the lost or damaged building immediately prior to the loss, subject to
the rebuilding or repairs being carried out.
We will normally expect you to carry out repair or replacement of the insured building, but
if you and we agree that it is not reasonable to do this, we will pay you an amount based
on the lesser of the repair or replacement costs, less an allowance for fees and associated
costs which are not incurred.
If the buildings are not repaired or rebuilt within a reasonable period of time we will only
pay the actual cash value.

B. In respect of contents lost or damaged we shall pay you:

i. on finished goods sold and awaiting collection, the regular selling price, less all discounts
and charges to which such goods would have been subject had no loss occurred.
ii. on other finished goods and on unfinished goods, the value of raw materials acquired
and labour expended plus the applicable proportion of overhead charges attributable to
such unfinished goods.
iii. for property of others held at the insured property, the amount for which you are
legally liable but in no event to exceed the actual cash value.
iv. on film, tape, disc, drum, cell and other magnetic recording or storage media for
electronic data processing, an amount not exceeding the cost of such media in
unexposed or blank form plus the costs of copying electronic data from back up or
from originals of a previous generation. These costs will not include research and
engineering nor any costs of recreating, gathering or assembling such electronic data.
If the media is not repaired or replaced the basis of valuation shall be the cost of the
blank media. This insurance does not insure any amount pertaining to the value of
such electronic data to you or any other party.
v. on documents other than iv) above an amount not exceeding the cost of blank material
plus the cost of labour incurred by you for transcribing or copying such records. This
insurance does not insure any amount pertaining to the value of such documents to
you or any other party.

C. On all other insured property lost or damaged, we shall pay you the actual cash value.
All amounts or values will be determined at the time of loss, and in no event will we be liable for
more than the amount insured. Any salvages, recoveries and payments recovered or received
prior to the loss settlement shall reduce the amount of such loss settlement accordingly.

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 War, Terrorism and Political Violence Insurance
Policy wording

Fees and associated This insurance includes within the amount insured, but not exceeding the sub-limit stated in
costs the policy schedule, cover for the following necessary and reasonable additional expenses that
you incur in reinstating or repairing the insured property following damage insured under this
insurance:
i. fees to architects, surveyors, consulting engineers and other professional consultants used
in the repair or reinstatement of the insured building(s); and
ii. the cost of removing debris of insured property from the named location(s) and making
the site and insured building(s) safe.

Excess No claim shall be payable under this insurance unless the aggregate of all such claims arising
out of each occurrence exceeds the excess amount specified in the policy schedule.

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 Conditions, definitions and exclusions applying to the
whole of this insurance
Policy wording

Basis of insurance All information provided in writing by you or your agent in connection with this insurance forms
the basis of and is incorporated into this insurance.
If you have not notified us about or have misrepresented any material facts or material
circumstances relating to this insurance which are known by you or could reasonably be
expected to have been known by you after proper enquiry, or make any claim knowing it to be
fraudulent, or in the case of any fraud or false statement, this insurance will be void from the
start of this insurance.

Definitions For the purpose of this insurance:

Act of terrorism An act of terrorism means an activity that:

i. is committed for political, religious, ideological or similar purposes and involves a violent act or
the unlawful use of force or an unlawful act dangerous to human life or tangible property; and
ii. is carried out by any person or group(s) of persons, whether acting alone or on behalf of or
in connection with any organisation(s); and
iii. is intended to:
a. intimidate or coerce a civilian population; or
b. disrupt any segment of the economy of a government, state or country; or
c. overthrow, influence, or affect the conduct of any government de jure or de facto by
intimidation or coercion; or
d. affect the conduct of a government by mass destruction, assassination, kidnapping or
hostage taking.

Actual cash value Actual cash value means the lesser of the amount it would cost to repair or replace the
insured property with material of like kind and quality, less an allowance for fees and
associated costs which are not otherwise incurred, with proper deduction for obsolescence and
physical depreciation. In the case of contents which cannot be repaired or replaced, actual
cash value means the market value of those contents at the time of loss.

Amount insured Amount insured means the maximum amount we will pay in the aggregate during the period
of insurance as shown in the policy schedule.

Buildings Buildings means a roofed and walled structure, including any signs, glass, interior decorations
and fixtures and fittings, lifts, fixed fuel tanks, driveways, footpaths, walls, gates, satellite dishes
and their fittings and masts.

Civil commotion Civil commotion means a substantial disturbance of the public peace by three or more
persons assembled together and acting with common intent.

Civil war Civil war means a hostile conflict by means of armed forces carried on between opposing
citizens of the same country or nation.

Contents Contents means fixtures and fittings (including interior decorations), machinery and equipment,
office furniture, stock (including finished or unfinished goods manufactured by you or held for
sale) for which values have been declared to and agreed by us.

Coup d’etat Coup d’etat means a sudden change in government other than by democratic means brought
about by the use or threat of violence.

Electronic data Electronic data means facts, concepts and information converted to a form useable for
communication, interpretation or processing by electronic and electromechanical data
processing or electronically controlled equipment and includes programs, software and other
coded instructions for the processing and manipulation of data or the direction and manipulation
of such equipment.

Insured property Insured property means the property specified in the policy schedule for which values have
been declared to and agreed by us and shall include contents. For the avoidance of doubt we
do not include land and water within insured property.

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 Conditions, definitions and exclusions applying to the
whole of this insurance
Policy wording

Insurrection Insurrection means a violent uprising of citizens in resistance to their government.

Malicious damage Malicious damage means the loss, damage or destruction of property caused by anyone
intending to cause harm or mischief during the disturbance of the public peace which is
committed for political, religious, ideological or similar purposes.

Mutiny Mutiny means a willful resistance by members of legally constituted, armed or peacekeeping
forces to a superior officer.

Occurrence Occurrence means each and every loss or series of losses arising out of and directly caused
by one event. However, the duration and extent of any one event with regard to the perils of
terrorism, sabotage, malicious damage, riots, strikes and civil commotion shall be limited
to physical loss or physical damage which occurs within a period of 72 consecutive hours. No
such period of 72 hours may extend beyond the expiry of this insurance unless you shall first
sustain direct physical loss or physical damage before the expiry of this insurance and within
the aforesaid period of 72 consecutive hours, nor shall any period of 72 consecutive hours
commence before the start of this insurance.

Pollutant and contaminant Pollutant (pollution) and contaminant (contamination) includes but is not limited to any
solid, liquid, gaseous or thermal irritant, contaminant or toxic or hazardous substance or any
substance the presence, existence, or release of which endangers or threatens to endanger the
health, safety or welfare of persons or the environment.

Rebellion Rebellion means a deliberate, organised and open resistance, by force and arms, to the laws
or operations of a government, committed by its citizens.

Revolution Revolution means the overthrow of a regime or political system by its citizens.

Riot Riot means a violent disturbance by three or more people assembled together which threatens
the public peace.

Sabotage Sabotage means a subversive act or series of acts committed for political, religious, ideological
or similar purposes including the intention to influence any government and/or to put the public
in fear for such purposes.

Strike Strike means a work stoppage by three or more workers to enforce demands made on an
employer or to protest against an act or condition.

War War means declared or undeclared hostile action between two or more nations or states save
as excluded under Exclusion 1.ii.

We/us/our We/us/our means Syndicate 33 at Lloyd’s managed by Hiscox Syndicates Limited.

You/your/yours You/your/yours means the insured stated in the policy schedule.

Exclusions This insurance does not cover:

1. loss, damage, cost or expense of whatsoever nature directly or indirectly occasioned by,
happening through or in consequence of any of the following:
i. any threat or hoax of a peril insured, as listed in the cover section of this policy;
ii. war, invasion, acts of foreign enemies, hostilities (whether war be declared or not)
between any of the following countries: the United Kingdom of Great Britain and
Northern Ireland, the United States of America, the Republic of France, the Russian
Federation, and the People's Republic of China;
iii. the emission, discharge, dispersal, release or escape of any chemical or biological agent;
iv. any electronic means including computer hacking or the introduction of any form of
corrupting, harmful or otherwise unauthorised instructions or code or the use of any
electromagnetic weapon.
This exclusion shall not operate to exclude losses (which would otherwise be covered
under this policy) arising from the use of any computer, computer system or computer
software programme or any other electronic system in the launch and/or guidance

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 Conditions, definitions and exclusions applying to the
whole of this insurance
Policy wording

system and/or firing mechanism of any weapon or missile;

v. pollution or contamination. However if:
a. a peril insured, as listed in the Cover section of this policy, is the sole, immediate
and direct cause of physical loss or physical damage to insured property; and
b. such physical damage is the sole, immediate and direct cause of pollution and/or
contamination of insured property at the named location,
then this policy, also insures the ensuing physical damage to insured property
caused by such pollution or contamination but in no event shall this policy include
any expense of clean-up or removal of land, water or air;
vi. vandalism, looting or theft unless such vandalism, looting or theft is a direct
consequence of a peril insured under this policy. Notwithstanding the foregoing, theft
or looting committed by or in collusion with any principal, shareholder (beneficial or
otherwise), partner, director or other officer or any employee of yours is excluded
from this insurance;
vii. confiscation, nationalisation, expropriation, requisition, detention, legal or illegal
occupation, embargo, quarantine by or under the order of any government or public
or local authority;
viii. possession of contraband or illegal transportation or illegal trade;
ix. nuclear reaction, nuclear radiation or radioactive contamination, however such
nuclear reaction, nuclear radiation or radioactive contamination may have been
caused;

2. loss of market, loss of income, loss of use, depreciation, reduction in functionality,

increased cost of working, mysterious disappearance or unexplained loss or any other
consequential loss, unless specifically provided for elsewhere within this policy;

3. loss of or damage to any building or contents therein, if such building has been
unoccupied for more than thirty consecutive days unless you have obtained our prior
written agreement;

4. loss of or damage to aircraft, watercraft, locomotives or rolling stock or vehicles designed

for road use unless such road vehicles:
a. are located on the premises insured under this policy; and
b. insured values have been declared to and agreed by us;

5. loss of or damage to pipelines, transmission and distribution lines and their supporting
structures outside of the named location(s) unless insured values have been declared to
and agreed by us;

6. loss or damage by exposure to or existence of asbestos or the cost of asbestos material

removal;

7. loss of or damage to land (including but not limited to land on which the insured property
is located) or water;

8. loss of or damage to any animal, plant or tree;

9. any financial loss related to the value of electronic data to you or any other party; and

10. any loss insured elsewhere. This includes a claim where, but for the existence of this
insurance, you would be entitled to be paid under any other policy, bond, government or
other indemnity or cover except for any amount in excess of the amount which would have
been covered under such other policy, bond or scheme or cover (which, for the avoidance
of doubt, includes any cover for riots, strikes, civil commotion and terrorism under a
property or builder's risk insurance).

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 Conditions, definitions and exclusions applying to the
whole of this insurance
Policy wording

Conditions
Notice and proof of loss It is a condition precedent to our liability that in the event of loss or damage or circumstances
arising that may give rise to a claim under this insurance notice is to be given to us through
your broker or agent as soon as reasonably possible or within 21 days, which ever the sooner.
If you make a claim under this insurance you must give us such relevant information and
evidence as may reasonably be required by us and co-operate fully in the investigation or
adjustment of any claim. if required by us, you must submit to examination under oath by any
person designated by us.
Before a claim can be paid you shall render a signed proof of loss as soon as reasonably
practicable. If such proof has not been received by us within 12 months of the expiry date of
this policy, we shall be discharged from all liability hereunder in respect of such loss.

Due diligence You (or any of your agents, sub or co-contractors) must use due diligence and do (and concur
in doing and permit to be done) everything reasonably practicable, including but not limited to
taking precautions to protect the insured property or remove the contents, to avoid or
diminish any loss insured and to secure compensation for any such loss including protecting
rights and taking action against other parties to enforce any rights and remedies or to obtain
relief or indemnity.

Change in You must notify us immediately of any change in your business operation during the period of
circumstance insurance which will materially affect this insurance. This includes but is not limited to changes
in management, ownership or control of your business, any change in the nature of the
business carried out at the insured property, in your operating conditions or values at risk. We
may then vary the terms and conditions of this insurance. If you are in any doubt whether a
change is material you should consult your broker or agent.

Inspection We, or our agent, have the right, at our own expense, to inspect at any reasonable time the
insured property.
Any such inspection will not constitute a guarantee or confirmation of safety of insured
property or any other buildings or property following notice of a claim or loss or damage or
circumstances that may give rise to a claim under this insurance.

Multiple insureds Our total liability for any loss or losses sustained by any one or more of you under this
insurance or any extension hereto will not exceed the amount insured. We shall have no
liability in excess of the amount insured whether such amounts consist of insured losses
sustained by all of you or any one or more of you.
You agree that the insured named in the policy schedule, or if there is more than one insured
named in the policy schedule the first of them, is authorised to receive all notices and agree any
amendments to the policy.

Third parties This insurance is effected solely between you and us. Pursuant to the Contract(s) Rights
Against Third Parties (Act 1999), nothing in this policy is intended to give any third party any
benefits under this insurance or the right to enforce a term of this insurance.

Protections maintenance You must ensure that all physical protections notified to us are in full and effective operation at
all appropriate times.
You must ensure that all fire alarm and security systems notified to us are fully activated
whenever the named location is left unattended. You must also advise us as soon as
reasonably possible if for any reason a system is not working properly. We may then vary the
terms and conditions of this insurance. All systems must be regularly serviced under contract
by a reputable company at least annually.

Under insurance If, at the time that any insured property is lost or damaged, the total value of all insured
property at that location is greater than the declared value for that location, then you shall only
be entitled to recover such proportion of the loss or damage as the declared value bears to the
total value of all insured property at that location.

Assignment No assignment of or change of interest in this policy or in any amount payable under it will be
binding on or recognized by us unless you have obtained our prior written agreement.

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 Conditions, definitions and exclusions applying to the
whole of this insurance
Policy wording

No benefit to bailee This policy will not operate in any way to the benefit of any bailee or any person to whom
insured property is entrusted for any purpose.

Subrogation We shall be entitled but not obliged to take over and deal with in your name (but at our
expense) the defence or settlement of any claim brought by the owners of others interested in
the property of others held at the insured property and to bring proceedings in your name to
recover for our benefit the amount of any payment made under this policy, including our own
costs and expenses. We shall be entitled but not obliged to exercise all of your rights and
remedies and you shall give all assistance in your power as we may require.

Salvage and recoveries All salvages, recoveries and payments recovered or received subsequent to a loss settlement
under this policy shall be for our benefit.

Abandonment There shall be no abandonment to us of any property.

Cancellation This policy may be cancelled by us as a result of non-payment of premium.

Arbitration All disputes which may arise under, out of or in connection with or in relation to this policy or the
determination of the amount of loss hereunder shall be submitted to arbitration in London at the
London Court of International Arbitration in accordance with its rules at the date of such
submission. The seat of the Arbitration shall be London. The award rendered by the
Arbitrator(s) shall be final and binding upon both you and us.

Law The construction, validity and performance of this policy and all matters arising there from shall
be governed by the laws of England,

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 Loss of net income insurance extension
Policy wording

Some of the words we use have a special meaning in this policy. If a word is in bold type,
please read the definitions section of this extension as well as those stated in the main Policy
which apply equally to this extension.
You should check the policy schedule to see if this extension of cover is in force.
This extension is subject to the terms, conditions and exclusions of the attached Hiscox War,
Terrorism and Political Violence policy (the policy) and to the terms, conditions, exclusions and
definitions appearing below.

Cover We will pay you for the loss of net income sustained by you during the period of indemnity
resulting directly from the interruption of your business at the named location(s) shown in the
policy schedule caused by direct physical loss or physical damage covered under the policy
and in respect of which a claim has been paid (or agreed to be paid) subject to the following
terms, exclusions and conditions.

Basis of settlement We will pay you for the difference between your actual net income during the interruption of
your business, and your net income during the corresponding period in the 12 months
immediately preceding the interruption, less any savings which result from reduced costs and
expenses or from revenue received for services rendered and/or the conduct of your business
elsewhere than at the named location(s) during the interruption and subject to any adjustment
provided below.
When adjusting your claim, account shall be taken for the trend of your business and of any
variations in your business before and after a loss insured under this policy and an allowance
will be made for all extraordinary and other circumstances of the business including but not
limited to fluctuations in market conditions so that the figure adjusted represents as nearly as
may be reasonably possible the results which but for the loss insured under this policy would
have been obtained during the period of indemnity.
If you could reduce the loss resulting from the interruption of business,
i. by complete or partial resumption of operation of the property, and/or
ii. by making use of merchandise, stock (raw, in process or finished), or any other property at
your locations or elsewhere; and/or
iii. by using or increasing operations elsewhere,
then such possible reduction shall be taken into account in arriving at the amount of loss
hereunder.
We will also pay, within the amount insured, your additional necessary and reasonable costs
that you incur in order to minimise your loss of net income and continue your business, less
any savings which result from the reduced costs and expenses during the interruption. The
expense incurred to minimise your loss may not be more than the amount of net income which
would otherwise have been lost.
The amount we will pay in settlement of a claim will never be more than the amount insured
which is a combined amount for losses arising from both physical loss or physical damage and
loss of net income as insured by this policy.

Conditions
Direct damage No claim shall be payable under this extension unless and until a claim has been paid, or
liability admitted under the policy to which this extension is attached and which gave rise to
interruption of business.
This condition shall not apply if no such payment shall have been made, or liability admitted,
solely owing to the operation of an excess amount which excludes liability for losses below a
specified amount.

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 Loss of net income insurance extension
Policy wording

Exclusions This insurance does not cover:

1. increase in loss caused by or resulting from interference at the named location(s) by
strikers or other persons with rebuilding, repairing or replacing the property or with the
resumption or continuation of operations;
2. increase in loss caused by or resulting from the suspension, lapse, or cancellation of any
lease, license, contract or order unless such suspension, lapse or cancellation results
directly from and is directly caused by circumstances covered in the policy or as a result of
any consequential business interruption and then we shall be liable for only such loss as
affects your net income during and limited to the period of indemnity covered under this
policy;

3. fines or damages for breach of contract or for late or non-completion of orders;

4. penalties of any nature;

5. loss of market share or any other consequential loss; or

6. loss of net income during the waiting period shown in the policy schedule.

Definitions For the purpose of this insurance:

Net income Net income means the money paid or payable to you for goods sold and delivered or services
rendered in the conduct of your business less working expenses.

Period of indemnity Period of indemnity means the period starting from the expiry of the waiting period and
continue for the entire period of interruption but not beyond the lesser of:
i. the time required, with the exercise of due diligence, to repair, rebuild or replace such part
of the insured property that has been lost or damaged; or
ii. 12 calendar months.

Waiting period Waiting period means the period stated in the schedule which shall commence on the date on
which the physical loss or physical damage occurs.

Working expenses Working expenses means those charges and expenses of your business which it is not
necessary to incur during the interruption of your business which include but are not limited to
the cost of stock, raw materials, supplies and the costs associated therewith. For the avoidance
of doubt working expenses do not include any fixed costs which continue to be payable in full
during the interruption of your business. The words and expressions used in this definition shall
have the meaning usually attached to them in your books and accounts.

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 War, Terrorism and Political Violence Insurance
Schedule

Insured:

Address for correspondence:

Period of insurance: / /

Named location(s):

Insured’s country:

Country(ies) of risk:

Insured property: as declared to and agreed by us

Amount insured: £ Each and every occurrence and in the aggregate subject to a sub-limit within the
amount insured of £ in respect of fees and associated costs.

Excess: Each and every occurrence.

Premium:

Proposal form dated: / /

Extension insured: Loss of net income included/not included (*delete as appropriate)

Waiting period consecutive days.

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