ADDITIONAL INSURANCES / PART VI / Clause 16

PREMIUM DUE ON TERMINATION OF INSURANCE

16.1 Premium due on termination of insurance

The Assured who ceases to be insured by the Association for any reason, shall be and remain liable to pay to the Association all premium which such Assured would have been liable to pay had the insurance not been terminated provided always that the Assured shall be liable for the premium for the Policy Year in which the insurance ceases pro rata only for the period beginning with the date of commencement of the insurance and ending with the happening of the event that occasioned the termination of the insurance if:

16.1.1 such termination arises upon the happening of any of the events specified under Clauses 14.1 to 14.6 and the Assured gives notice of the event in writing to the Managers within one month of the date thereof; or

16.1.2 such termination arises by virtue of Clause 13.1 Termination of all insurances – Failure to pay in such case the Assured’s liability to pay shall include the sum specified in the notice given under that Clause.

16.2 Set-off

For the purpose of determining whether any (and, if so, what) sum is due for the purposes of Clause 16.1 or otherwise under the Certificate of Insurance no account shall be taken of any amount due or alleged to be due by the Association to the Assured for any reason whatsoever, and no set-off of any kind (including any set-off which might otherwise have arisen by reason of the bankruptcy or winding up of the Assured) shall be allowed against such sum (whether or not any set-off against premium has been allowed at any time in the past), except to the extent (if any) to which any sum demanded by the Managers as due, and required to be paid in a notice served under Clause 13.1 Termination of all insurances – Failure to pay, may (in the Managers’ discretion) in itself have already allowed for a set-off or credit in favour of the Assured.