Subscription Agreement Reinsurance
Oriental again insured the risk in London. The reinsurance policy, governed by English law, contained a “Follow the settlements” condition under the following conditions: “Follow all conditions and accounts of the original policy issued by the insured to the insured for the period indicated for the amounts and interest covered by this.” The reinsurance policy contained a guarantee for the typhoon identical to the original insurance guarantee, with the exception of the second paragraph (as of “However … ) of the initial insurance guarantee. One of the line ships of the original policy was the Princess of the Stars, a Ro-Ro vehicle and a passenger ferry. The vessel departed Manila on June 20, 2008, despite a typhoon warning. 713 passengers and 138 crew members were loaded on board. The ship was lost during the voyage, more than 800 people lost their lives and only 32 survived. In the Philippines, a number of freight interest claims have been filed against Sulpicio and Oriental. While these rights have been dealt with by the Philippine courts, English reinsurers have sought relief from the negative statement that the reinsurance guarantee must be interpreted in English law, but not in the same way as the original insurance guarantee. The jurisdiction and the clauses of choice are not taken up by the general terms of communitisation. Such direct insurance clauses have nothing to do with the definition of risk; They therefore become totally unsuitable for disputes between the parties to the reinsurance contract.27 Arbitration clauses cannot be introduced either because of their ancillary clause and separation clause28.28 If an arbitration procedure, jurisdiction or choice of law clause is to be introduced, it should be explicitly specified in the reinsurance contract. The inclusion of the terms of direct policy should be distinguished from the inclusion of terms from other sources, such as standard market formulation.B. In the latter case, problems may arise on inconsistent intermediate conditions between the standard and express conditions of the admission contract that the court is able to resolve.
For example, in Axa/Ace Global Markets,28a, reinsurance was implemented on “Full formulation as EXEL 1.1.90.” Gloster J was able to align the compromise clause in the standard EXEL formulation with the English jurisdiction and law clause in the reinsurance certificate, noting that it dealt with the control of arbitration and the challenge of an award and consequently finding that the compromise clause was included in exel 1.1.90 with other standard clauses.