SECURITY INDUSTRY LIABILITY INSURANCE POLICY In consideration of the payment of premium as agreed, by or on behalf of the Insured, Imax Risk Managers (Pty) Ltd T/A Quantum Liability Underwriting Managers (Reg No: 2004/023561/07) on behalf of Genric Insurance Company Ltd (Reg No: 2005/037828/06) (hereinafter called the Insurer) agrees to indemnify or compensate the Insured by payment or at the option of the Insurer by replacement, reinstatement or repair in respect of loss / damage as agreed herein, up to the agreed limits of indemnity, occurring during the period of insurance, less any excess payable by the Insured. Definitions: The following words will have the meaning set out below wherever they appear in the policy: The Insurer Genric Insurance Company Ltd (Reg. No.: 2005/037828/06) The Underwriting Manager The Underwriting Manager is Imax Risk Managers (Pty) Ltd t/a Quantum Liability Underwriting Managers. The Underwriting Manager has been duly appointed and authorized by the Insurer to issue the policy, negotiate premiums, and settle the claims on behalf of the Insurer. The Insurer and Underwriting Manager are collectively referred to as the Insurer, We/Our/Us The Policyholder / Insured Any person(s) named in the schedule. The policyholder is hereafter referred to as the insured, You/Your You/Your means the insured as Stated Above and Means each of the following, to the extent set forth below; a) the named Insured in the Schedule; b) all subsidiary companies (present and future) of the Insured whose places of operation are within The Republic of South Africa. c) any director, executive officer, employee or partner of the Insured or of a company designated in d) but only whilst acting within the scope of their duties in such capacity; e) any principal in respect of the liability of such principal arising out of the performance by the Insured or by a company designated in (b) of any contract or agreement for the performance of work for such principal to the extent required by such contract or agreement but limited to the coverage provided by this Policy; Policy Page 1 of 12 10 March 2013
Policy Schedule / Schedule Document attaching hereto and forming an integral part hereof showing the details of the policyholder and stating inter alia the applicable sections of cover, the maximum benefits and excesses payable and cover provided. Occurrence Means an event, including continuous or repeated exposure to substantially the same general conditions, which results in Personal Injury or Property Damage neither expected nor intended from Your standpoint. Warranty Definition Where the word warranty appears in the policy, it is deemed to have meaning as implied in an insurance context. Any breach of any warranty will result in the Insurer having no liability in terms of the policy. Client Definition Where the word Client appears in the policy, it is deemed to have meaning of Your Client/Customer with whom you have a written and signed security service agreement. Claim The term claim or claims shall mean any: a) written, summons, application or other legal or arbitral proceedings, cross-claim or counterclaim issued against or served upon You; b) written or verbal demand alleging liability communicated to You under any circumstances and by whatever means. Medical Persons Means qualified medical practitioners, dentists, nurses and first-aid attendants Vehicle Means any type of machine on wheels or on self-laid tracks which was made or intended to be propelled by other than manual or animal power. Vehicle includes any trailer or caravan or other implement made or intended to be drawn by any such machine. Injury Means death, bodily injury, illness or disease of or to any person Damage Means loss of possession or control of or actual damage to physical property Policy Page 2 of 12 10 March 2013
Pollution Means pollution or contamination of the atmosphere or of any water, land or other physical property Product Means any physical property after it has left the custody or control of the Insured which has been designed, specified, formulated, manufactured, constructed, installed, sold, supplied, distributed, treated, serviced, altered or repaired by or on behalf of the Insured, but shall not mean food and drink supplied by or on behalf of the Insured primarily to the Insured's employees as a staff benefit Security Claims Means claims arising out of or in connection with or during the active provision of any Security Service (refer Section D Security Claims Definitions 1) Negligent Advice Means incorrect or inadequate advice or information of a technical nature given in the promotion of the Insured s Products or services but not where such advice or information - is given in exchange for a fee or similar consideration, or - is an essential part of a revenue earning activity of the Insured Professional Negligence Means any negligent act, error or omission committed by the Insured in the execution and conduct of the professional activities of the Insured as Security Consultants and/or Security Personnel Training Centres and/or, where Section E Extension 1 has been granted, Paramedic and Ambulance Services Money Means cash, bank and currency notes, cheques, postal orders, money orders, current negotiable postage, revenue and holiday stamps, credit card vouchers and documents, certificates or other instruments of a negotiable nature. General Policy terms and conditions: 1. Operative Clause Insurers will indemnify the insured against its liability to pay compensation (including claimants costs, fees and expenses) in accordance with the law of any country within the Territorial Limits but not in respect of any judgment, award, payment of settlement arising out of a claim or proceedings made elsewhere (or to any order made within the Territorial Limits to enforce such judgment, award, payment or settlement either in whole or in part). Policy Page 3 of 12 10 March 2013
The Indemnity only applies to such liability as defined in each insured Section of this Policy in respect if claims occurring and first made against the Insured during the Period of Insurance and arising out of the ordinary course of the Business as specified in the Schedule, subject always to the terms, exclusions, conditions and limitations of such Section and to the Certificate as a whole. 2. Inception of Insurance This is an Annual policy and cover is in force from the inception date as stipulated in the policy schedule until annual expiry of cover, twelve months thereafter. Reference to Policy Period in the policy schedule in respect of monthly paid policies, is deemed to describe premium payment frequency. 3. Cancellation This policy may be cancelled by either the Insured or the Insurers by giving 30 days notice of cancellation in writing. Such cancellation shall become effective after midnight of the day on which such notice expires. Premium or pro-rata thereof will continue to be payable for the duration of any such notice period of cancellation. In the event that the policy is cancelled prior to the expiry of the full 12 month period of insurance, the limit of indemnity under this policy will be reduced accordingly on a pro-rata to time basis. Should a claim have incurred which represents more than 50% of the annual limit of indemnity, the full annual premium or unpaid portion thereof will immediately become due and payable. 4. South African Jurisdiction It is hereby agreed that this insurance shall be governed by the laws of the Republic of South Africa whose courts shall have jurisdiction in any dispute arising hereunder. 5. Claim Notification Warranty Warranted all claims / losses which are to be considered under this policy are to occur during the policy period as stated in the schedule, and reported to insurers, in writing, within 30 days after the insured becomes aware of a potential claim. Insurers will consider no further claims for losses reported 30 days after the expiry of the policy 6. Loss Prevention Warranty It is warranted the Insured shall take all reasonable measures in averting or minimizing a loss and shall ensure that all rights against third parties are properly preserved and exercised. 7. Prescription Warranty It is warranted that in the event of the Insurer declining liability for any loss submitted in terms of this policy, unless legal action is instituted against the Insurer to challenge such declinature within ninety days of the time of the Insurer giving notice of such declinature, the right to institute legal action against the Insurer thereafter will be forfeited. Any summons is to be served at the office of Quantum Liability Underwriting Managers (as Policy Page 4 of 12 10 March 2013
agents authorized to receive same on behalf of the Insurer). No claim shall be payable after the expiry of twelve months from the date of the occurrence giving rise to the loss, unless the claim is the subject to already instituted legal action against the Insurer 8. Premium Warranty It is a warranty of cover that at inception of cover and upon each renewal the Insured will pay the Insurer a premium as stipulated in the policy schedule. In respect of monthly paid policies it is warranted that the Insured will pay the Insurer a premium as stipulated in the policy schedule by the first day of each calendar month, unless premium payment is transacted by means of a monthly debit order administrated by the Insurer, in which case premium is payable to the Insurer on the date chosen by the Insurer to lodge this debit order. The insured shall ensure that this premium debit is successfully met. Breach of this warranty will entitle the Insurer to avoid liability for all losses. 9. Fraud and Fidelity Exclusion If any claim under this policy is in any respect fraudulent or if any fraudulent means are used by the Insured or anyone acting on his behalf to obtain any benefit under this policy, or if any loss be occasioned by the willful act of the Insured, all benefit under this policy shall be forfeited. This policy excludes the dishonesty of any employee, agent, shareholder, director, officer, partner or executive management of the Insured whether acting alone or in collusion with others. 10. Other Insurance Clause If at the time of any event giving rise to a claim under this policy, any other insurance exists covering similar defined events, the Insurer shall be liable to make good only a rateable proportion of the amount payable to the Insured in respect of such event. If any such other insurance is subject to any condition of average, this policy, if not already subject to any condition of average, shall be subject to average in like manner. 11. Defence Costs Clause The Insurers will pay all costs, fees and expenses incurred by the Insured with Insurers prior consent subject to the limits of indemnity as stated in the schedule of insurance and ( Defence Costs ): a) In the investigation defence or settlement of, and/or b) As a result of representation at any inquest, inquiry or other proceedings in respect of matters which have a direct relevance to any occurrence which forms or which could form the subject of indentify under this policy Such costs, fees and expenses incurred by Insurers shall be deemed to be costs, fees and expenses incurred by the Insured with Insurers prior consent 12. Admission of Liability and Claims Control No admission, offer, promise or payment shall be made or given by or on behalf of the insured without the written consent of the Insurers who shall be entitled to take over and conduct in the name of the insured the defence or settlement of any claim or to prosecute Policy Page 5 of 12 10 March 2013
in the name of the insured to their own benefit any claim for indemnity or damages or otherwise and shall have full discretion in the conduct of any proceedings and in the settlement of any claim and the insured shall give such information and assistance as the Insurers may reasonably require. The Insurers may at any time pay to the insured in connection with any claim or series of claims under this policy to which an indemnity limit applies the amount of such limit (after deduction of any sums already paid) or the lesser amount for which such claims can be settled and upon such payment be made, the underwriter shall relinquish the conduct and control of and be under no further liability in connection with such claims 13. General Provisions 13.1 Continuous Exposure Clause In the event of any Injury or Damage arising from continuous or continual inhalation, ingestion or application of any substance where the Insured and the Insurers cannot agree when the Injury or Damage occurred then: 13.1.1 Injury shall be deemed to have occurred when the claimant first consulted a qualified Medical Practitioner in respect of such Injury 13.1.2 Damage shall be deemed to have occurred when it first became evident to the claimant, even if the cause was unknown. 13.2 Indemnity to Others The indemnity granted extends to: 13.2.1 at the request of the Insured, any party who enters into an agreement with the Insured for any purpose of the Business, but only to the extent required by such agreement to grant such indemnity and subject to General Exclusions Clause 4 and Section A General Public Liability - Exclusions 1.3 13.2.2 officials of the Insured in their business capacity arising out of the performance of the Business and/or in their private capacity arising out of their temporary engagement of the Insured's employees 13.2.3 at the request of the Insured, any person or firm for their liability arising out of the performance of a contract to provide labour only services to the Insured 13.2.4 the officers, committee and members of the Insured's canteen, social, sports, medical, fire fighting and welfare organisations in their respective capacities as such 13.2.5 the personal representatives of the estate of any person indemnified by reason of this in respect of liability incurred by such person Provided always that all such persons or parties shall observe, fulfill and Policy Page 6 of 12 10 March 2013
be subject to the terms, conditions, exclusions and limitations of this Policy. 13.3 Cross Liabilities Each person or party specified as the Insured in the Schedule is separately indemnified in respect of claims made against any of them by any other of them, subject to Insurers' total liability not exceeding the stated Indemnity Limits and subject to the provisions of [General Exclusion Clause 3],[ Section D Security Claims Exclusions 4] and [Section E Professional Indemnity Exclusions 7.] 14. Indemnity limits Insurers will be liable to pay; a) Compensation (including claimants costs, fees and expenses) b) Defence Costs c) Interest on damages in accordance with any legislation or award and shall not exceed the indemnity limit stated in the schedule against each section 14.1 For the purpose of determining the amount of indemnity afforded under this insurance where VAT is recoverable by the Insurers, same shall be payable in addition to the indemnity limit stated in the schedule 14.2 Any interest on damages payable in accordance with legislation governing such interest but not including interest payable from date of judgment, award or settlement of any claim, shall be deemed to be inclusive in the indemnity limit stated in the schedule 14.3 Indemnity limit per claim shall mean the indemnity limit applies to any one claim or series of claims arising from one originating cause 14.4 Indemnity limit per period as stated in the schedule of insurance represents the total amount of Insurers liability in respect of all claims during the period of insurance 14.5 Should liability arising from the same one originating cause form the subject of indemnity by more than one section of this policy, each section shall be subject to its own indemnity limit, provided always that the total amount of Insurers liability shall be limited to the greatest indemnity limit available under any one of the sections providing indemnity and subject to the provisions of the clauses 17.3 and 17.4 above. 15. Territorial Limits Cover is limited to losses occurring as stipulated in this insurance policy and schedule and limited to South Africa, Namibia, Mozambique, Swaziland Botswana and Lesotho. Policy Page 7 of 12 10 March 2013
16. Hold Harmless Agreement The insured may not enter into agreements with clients or other parties which excludes or reduces any rights to make a claim against those parties at any time without the written consent of the Insurers. Should such agreements be entered into without such consent, the amount which may be payable in the event of the claim will be reduced by the extent to which such agreement prevent the Insurers from making a claim against the parties under the insurers rights of subrogation. 17. Subrogation The insurer is entitled to recover under any claim any amount paid to the insured or any third party on the insured s behalf for the insurers expense and benefit, under subrogation. He insured is required to provide all reasonable assistance and information in pursuing such claim / recovery. 18. Premium Adjustment Clause If premium for this policy has been calculated based on estimates provided by the insured, the insured shall within 30 days after the expiry of the period of insurance provide the insurers with accurate and final figures on which the estimate was based. The premium for the period may be adjusted upwards and shall become immediately due and payable to the insurer. Failure to make payment for a previous period of insurance will allow insurers to avoid any liability for the current period of insurance. 19. Client Interest Notwithstanding anything to anything to the contrary contained in this Policy, the insurer will treat any client as defined herein, as the Insured under this Policy, provided always that: a) the indemnity provided herein shall apply only in respect of claims made against the insured by the insured s Client and or by any independent Third Party and Arising out of such liability which would have attached to the insured or Your Client, had the claim in the first instance been made against the insured. b) the Client shall at all times be subject to the terms, exclusions, conditions and limitations of the Policy. c) This Policy does not cover indemnity extended for any liability agreed to in terms of the provisions of any Contract or agreement between the insured and the insured s Client, which liability would not legally have attached to the insured had the insured not entered into the terms of such Contract or agreement. d) notwithstanding the provisions hereof:- In the event of the insurer alleging that no indemnity is provided in terms of this Clause, the onus of providing the us with proof of the contrary shall rest with the insured. Nothing herein contained shall be deemed to relieve the Client of their common law rights. Policy Page 8 of 12 10 March 2013
20. Airport Security In respect of the Insured s Contracts for the provision of Airport Security Services at any airport or Airfield: a) The insured shall, as a condition precedent to the insurer providing indemnity as set out in this Policy under this Policy at all times:- (i) (ii) Comply with ANY AND ALL Acts and regulations as imposed by the relevant authorities. only employ such Security Personnel registered and trained to a minimum of Grade C and comply to the National Key Points Act, 1980 (Act No.102 of 1980) and any amendments and or regulations thereto. 21. Misrepresentation Should you conceal or misrepresent any material fact or circumstances relating to this insurance, this insurance shall become void. 22. Special policy warranties It is warranted that the insured shall adhere to and comply with any and all acts, prescriptions and contractual obligations agreed to, by and between the insured and the insured s clients; Cover in terms of this policy will only be extended to the insured for clients with a written service agreement; Such service agreement will not materially differ from the template service agreement as disclosed to the insurer on or before inception of this policy; The insured must comply with any terms, conditions or warranties as set out in this insurance policy. Policy Page 9 of 12 10 March 2013
General Exclusions: 1. Prior Events This policy does not cover liability arising out of any occurrence or event the circumstances of which were known and have occurred before inception of this policy 2. Employers Liability This policy does not cover liability for and/or arising out of injury to any person employed or under a contract providing any labour services to the Insured where such injury arises out of the execution of such contract 3. Holding & Subsidiary Companies This policy does not cover liability arising out of any claims made against the Insured by any Holding or Subsidiary Company of the Insured or by any person or entity having a financial interest in the Insured unless such claims emanate directly from an independent third party 4. Fines, Penalties and Performance Warranties This policy does not cover liability arising out of liquidated damages clauses, penalty clauses or performance warranties unless liability would have attached in the absence of such clauses or warranties 5. Punitive & Exemplary Damages This policy does not cover liability for awards or damages of a punitive or exemplary nature whether in the form of fines, penalties, multiplication of compensation awards or damages or aggravated damages or in any other form whatsoever 6. Excess Clause Claims recoverable under this policy shall be subject to an excess as stated in the schedule of insurance. (i) The amount stated shall be deemed to be exclusive of VAT (ii) Where the excess is stated to be costs inclusive, for the purpose of such excess, the term claim shall be deemed to include compensatory awards, claimants costs, fees and expenses and associated Defence Costs 7. Professional Risks This policy excludes any losses or claims arising out of design, formula, specification or advice of a professional nature given by or on the behalf of the insured in exchange for a fee or similar consideration, but this exclusion shall not apply to claims which form the subject of Professional Indemnity extension under this policy Policy Page 10 of 12 10 March 2013
8. Contractual Liability This policy does not cover liability for losses attaching to the insured in terms of the provisions of any contract or agreement which liability would not have attached to the insured in the absence of such provisions, unless agreed to in writing with the Insurers 9. Additional General Exclusions This policy does not cover: (i) mysterious disappearances or unexplained loss, (ii) any liability arising out of the loss or shortage discovered while taking inventories. (iii) This policy does not cover loss arising whether directly or indirectly from the insolvency, administration, voluntary arrangements with creditors, bankruptcy or receivership of: a. the insured and or the insured clients; b. any third party whose property may have become indistinguishable from the insured property (iv) any liability arising out of/or contributed by due to the failure of the supply of electricity and/or communication facilities. (v) the insured s liability in terms of any judgment, award, payment or settlement arising out of a claim or proceedings made outside the Territorial Limits (or to any order made within the Territorial Limits to enforce such judgment, award, payment or settlement either in whole or in part): a. Any financial and/or economic loss consequent upon damage to any Aircraft; b. Personal injury or property damage arising out of the ownership, maintenance, possession of, use by You of any Vehicle; which is registered, or which is required to be registered; c. Claims arising out of the deployment of Sub-Contractors. (vi) the Personal Injury or Property Damage arising directly or indirectly out of the use of firearms, unless the Firearm Extension is granted, as stated in the Schedule. (vii) Personal Injury or Property Damage arising directly or indirectly out of the use or operation of dogs unless the insured has: a. complied with all statutory obligations, by-laws or regulations imposed by all relevant public authorities for their use or operation. b. declared the use or operation of dogs prior to inception of this policy. Policy Page 11 of 12 10 March 2013
(viii) (ix) (x) Personal Injury or Property Damage arising directly or indirectly out of the provision of free range dogs, or dogs not under the control of a handler, or dogs not muzzled. Personal Injury or Property Damage cause by, or arising directly or indirectly out of, or in any way involving, the provision of any form of security at any airport or aircraft landing area. claims arising out of the transportation of goods, valuables or cash (as defined herein): a. any claim which is based on or attributable to any failure or omission on the part of the insured to effect or maintain insurance. b. any claim arising out of delays in the performance of services or the supply of products c. any claim for the failure to perform to the conditions of any contract Policy Page 12 of 12 10 March 2013