62ZVTime limits for alternative indemnity contracts

62ZV Time limits for alternative indemnity contracts

62ZV Time limits for alternative indemnity contracts

(1) An alternative indemnity contract under this Part provides alternative indemnity product cover in respect of loss only if a claim in respect of the loss is made to the provider during the period of specialised insurance cover.

Note.

Subclause (1) is the general rule but there are exceptions to this general rule, as provided by this clause.

(2) A loss that becomes apparent in the last 6 months of the period of specialised insurance cover has an extended claim period, which permits a claim in respect of the loss to be made within 6 months after the loss becomes apparent.

(3) Despite subclause (2), there is no extended claim period for loss that—

(a) arises from non-completion of work, or

(b) arises from a breach of a statutory warranty that is covered by a construction period alternative indemnity contract.

(4) When a loss becomes apparent during the period of specialised insurance cover but a claim cannot be made during that period because an indemnified event has not occurred, a claim can be made after the period of the cover (as a delayed claim) but only if—

(a) the loss was properly notified to the provider during the period of cover (or within 6 months after the loss became apparent in the case of a loss that became apparent in the last 6 months of the period of cover), and

(b) the beneficiary under the alternative indemnity contract making the claim diligently pursued the enforcement of the statutory warranty concerned after the loss became apparent.

(5) A delayed claim can also be made when the indemnified event occurs in the last 6 months of the period of specialised insurance cover (as if the covered event did not occur until after the period of cover) subject to compliance with the other requirements of this clause for a delayed claim.

(6) For the purposes of subclause (4) (b), the following factors are to be taken into account in determining whether the conduct of the beneficiary under a alternative indemnity contract constitutes diligent pursuit of the enforcement of a statutory warranty—

(a) whether or not the beneficiary has fulfilled the duties imposed on the beneficiary by section 18BA of the Act,