PPP Contracts

SCHEDULE 5.19 - Insurance

Employers' Liability Insurance

1.1 Infraco may take out and maintain employers' liability insurance cover for shareholders from time to time of Infraco in their capacity as shareholders, Infraco's Initial Shareholders and/or Affiliates of such Initial Shareholders, in each case to the extent of their interest in the PPP, provided that LUL's prior consent ( such consent not to be unreasonably withheld or delayed ) is obtained ( including in relation to identifying the insured parties ).

1.2 Infraco shall procure that any contract entered into by it with any contractor or sub-contractor shall contain provisions which require the contractor or sub-contractor to take out employers' liability insurance to comply with Employers' Liability ( Compulsory Insurance ) Act 1969.

Contract Works Insurance

2.1 Provided such insurance is available in the insurance market at commercially acceptable terms, Infraco shall take out and maintain, or cause to be taken out and maintained, from the Transfer Date and throughout the remaining duration of the Contract, insurances covering the risks and liabilities as detailed in Part A of the Annex to this Schedule on the basis of not less than standard market terms, conditions and exclusions as are detailed in Part A of the Annex to this Schedule ( the Contract Works Insurance ). In relation to the Contract Works Insurance third party liability section ( section 2 set out in paragraph 2 of Part A of the Annex to this Schedule ): (a) that section shall cover ( but shall not exceed ) the first £25,000,000 arising from any one occurrence or series of occurrences arising out of any one source or original cause ( and in the aggregate for product liability and pollution ); and

(b) LUL shall be responsible for, and shall indemnify Infraco ( on its own behalf and/or as agent for other relevant insureds under the third party liability section of the Contract Works Insurance ) from and against, Losses suffered or incurred by Infraco and/or any of the other insured parties under the third party liability section of the Contract Works Insurance as a result of claims made by third parties to the extent that such claims exceed the first £25,000,000 ( as detailed at paragraph 2.1(a) above ) and to the extent that the amount of the claims which exceed the said first £25,000,000 would have been covered under the third party liability section had such third liability cover been taken out and maintained in excess of the first £25,000,000.

2.2 LUL shall not be responsible for recovering any deductible from any sub-contractors or other insured parties ( other than LUL Parties, and direct or indirect contractors or sub-contractors in each case acting on behalf of LUL ) under the Contract Works Insurance.

2.3 In the event that the Contract Works Insurance required to be purchased by Infraco (i) is available in the insurance market at commercially acceptable terms but is not purchased by Infraco or (ii) is not available in the insurance market to Infraco and this is due to claims caused by Infraco arising from events within the control of Infraco ( including claims attributable to its direct or indirect contractors or sub-contractors ), and LUL Parties and/or Infraco Parties of another Infraco that would have been covered under the Contract Works Insurance incur any Losses that would have been covered under the Contract Works Insurance if such insurance (a) had been available in the insurance market at commercially acceptable terms and purchased by Infraco or (b) would have been available in the insurance market to Infraco but for such claims caused by Infraco ( as above ), then Infraco shall indemnify LUL Parties and such Infraco Parties of another Infraco for such Losses suffered or incurred. The amount payable by Infraco under this indemnity shall not exceed the amount of the proceeds of a claim under the Contract Works Insurance had it been so available or purchased.

2.4 LUL shall ( and Infraco and LUL shall each use its reasonable endeavours to procure that each of the other insured parties that would have been covered under the Contract Works Insurance had such Contract Works Insurance been taken out shall ), so far as reasonably practicable, mitigate the Losses incurred by it ( or by such other insured parties as the case may be ) which are the subject of the indemnity in paragraph 2.3. Infraco's liability to indemnify LUL and/or such other insured parties as provided in paragraph 2.3 shall be reduced proportionately to the extent that LUL and/or such other insured parties have failed to mitigate such Losses.

2.5 In the event that the Contract Works Insurance ( or any of the cover to be provided by the Contract Works Insurance ) required to be purchased by Infraco is unavailable in the insurance market or is not available at commercially acceptable terms and Infraco ( or any of the other insureds under the Contract Works Insurance apart from LUL Parties ) incurs any Losses that would have been covered under the Contract Works Insurance if such insurance had been available in the insurance market or had been available at commercially acceptable terms then LUL shall indemnify Infraco ( on its own behalf and/or as agent for other relevant insureds ( as aforesaid ) ) for such Losses suffered or incurred. The amount payable by LUL under this indemnity shall not exceed the amount of the proceeds of a claim under the Contract Works Insurance had it been so available. Infraco shall notify LUL as soon as reasonably practicable upon becoming aware that the Contract Works Insurance ( or any of the cover to be provided by the Contract Works Insurance ) is or is likely to become unavailable in the insurance market or is not available at commercially acceptable terms.

2.6 The indemnity provided by LUL in paragraph 2.5 shall not apply to the extent that the Contract Works Insurance is not available to Infraco in the insurance market or is not available to Infraco at commercially acceptable terms and this unavailability is due to claims caused by Infraco arising from events within the control of Infraco ( including claims attributable to its direct or indirect contractors or sub-contractors ).

2.7 Infraco shall ( and Infraco and LUL shall each use its reasonable endeavours to procure that each of the other insured parties that would have been covered under the Contract Works Insurance had such Contract Works Insurance been available in the insurance market at commercially acceptable terms ), so far as reasonably practicable, mitigate the Losses incurred by it ( or by such other insured parties as the case may be ) which are the subject of the indemnity in paragraph 2.5. LUL's liability to indemnify Infraco and/or such other insured parties as provided in paragraph 2.5 shall be reduced proportionately to the extent that Infraco and/or such other insured parties have failed to mitigate such Losses.

Adjustment Mechanism

3.1 At least three (3) months prior to the renewal date of each of the Contract Works Insurance and the Employers' Liability Insurance for each of the years up to the First Review Date ( excluding the time up to and including the Transfer Date ), LUL and each of the Infracos shall meet to review each of the Contract Works Insurance arrangements and the Employers' Liability Insurance arrangements. In such review, LUL and Infraco ( each acting reasonably ) shall consider and may agree alternative Contract Works Insurance arrangements or alternative Employers' Liability Insurance arrangements to effect the Contract Works Insurance and the Employers' Liability Insurance ( as the case may be ) which may be more appropriate to the Contract than the Contract Works Insurance arrangements or the Employers' Liability Insurance arrangements ( as the case may be ) existing at the relevant time and changes to the policy limits that may be considered appropriate. Infraco shall issue to LUL a proposal in relation to its alternative Contract Works Insurance arrangements and alternative Employers' Liability Insurance arrangements which it considers may be appropriate.

3.2 Subject to paragraph 3.8, if LUL and Infraco ( each acting reasonably ) have not, pursuant to paragraph 3.1 above, agreed any of the Contract Works Insurance arrangements or the Employers' Liability Insurance arrangements by the date falling thirty (30) days before the relevant renewal date of the Contract Works Insurance and the Employers' Liability Insurance ( as the case may be ), the Contract Works Insurance arrangements and the Employers' Liability Insurance arrangements ( as the case may be ) existing at the relevant time shall be renewed.

3.3 If the Contract Works Insurance deposit premiums and/or the Employers' Liability Insurance deposit premiums ( as the case may be ) for any of the years up to the First Review Date ( excluding the time up to and including the Transfer Date ) payable by Infraco on or about the Transfer Date in respect of the first year after the Transfer Date or payable by Infraco on or about each renewal date for each of the years thereafter, are greater than the aggregate of the anticipated Contract Works Insurance costs and/or the anticipated Employers' Liability Insurance costs ( as the case may be ) for that year as detailed in Part B of the Annex to this Schedule ( in each case the Anticipated Insurance Costs ) by an amount which is greater than 25 per cent. ( the aggregate of the amount up to 25 per cent. and the amount exceeding such 25 per cent. being the Shortfall ) then LUL shall in each such case pay to Infraco, by way of an Exceptional Amount in the first Payment Period after the deposit premiums have been paid by Infraco for the relevant year, an amount equal to the Shortfall. For the purposes of this paragraph 3.3, each of the deposit premiums shall include insurance premium tax, insurance brokerage or fees.

3.4 Subject to paragraph 3.5, if the cost of the annual aggregate premiums for the Contract Works Insurance and/or the Employers' Liability Insurance ( as the case may be ) in any year up to the First Review Date ( excluding the time up to and including the Transfer Date ) is greater than the aggregate of the Anticipated Insurance Costs and any Exceptional Amount paid by LUL to Infraco in accordance with paragraph 3.3 for that year, then LUL shall pay to Infraco, by way of a further Exceptional Amount in the first Payment Period after such premiums have been paid by Infraco, an amount equal to the amount by which the annual aggregate premiums for the Contract Works Insurance and/or Employers' Liability Insurance ( as the case may be ) exceed the aggregate of the Anticipated Insurance Costs and any Exceptional Amount paid by LUL to Infraco in accordance with paragraph 3.3. If the cost of the annual aggregate premiums for the Contract Works Insurance and/or the Employers' Liability Insurance ( as the case may be ) in any year up to the First Review Date ( excluding the time up to and including the Transfer Date ) is less than the aggregate of the Anticipated Insurance Costs and any Exceptional Amount paid by LUL to Infraco in accordance with paragraph 3.3 for that year ( including where such costs are less because the Contract Works Insurance ( or any of the cover to be provided by the Contract Works Insurance ) is not purchased and the indemnity provided by LUL in paragraph 2.5 applies ), then Infraco shall pay to LUL, by way of an Exceptional Amount in the first Payment Period after such return premiums have been received by Infraco, an amount equal to the amount by which the annual aggregate premiums for the Contract Works Insurance and/or the Employers' Liability Insurance ( as the case may be ) are less than the aggregate of the Anticipated Insurance Costs and any Exceptional Amount paid by LUL to Infraco in accordance with paragraph 3.3. For the purposes of this paragraph 3.4, each of the annual aggregate premiums shall include insurance premium tax, insurance brokerage or fees.

3.5 If the renewal premium ( including insurance premium tax, insurance brokerage or fees ) payable for Contract Works Insurance or the Employers' Liability Insurance ( as the case may be ) is increased due to the adverse claims experience of Infraco, LUL shall not be liable for the proportion of the premium increase which relates to the claims loading applied by the insurers in respect of that adverse claims experience.

3.6 In the event that in any year up to the First Review Date Infraco is required to accept a deductible for its Contract Works Insurance or its Employers' Liability Insurance ( as the case may be ) that is higher than the deductible set out in Part C of the Annex to this Schedule in respect of any such insurances, then save where such higher deductible is due to the adverse claims experience of the parties ( other than the LUL Parties or Infraco Parties of another Infraco ( including the Subsidiary ( if any ) related to such other Infraco ) ) insured under the Contract Works Insurance or the Employers' Liability Insurance, LUL shall be liable in any such year at the end of such year by way of an Exceptional Amount in the first Payment Period after the end of such year ( but subject to paragraph 3.7 ) for the difference between the relevant deductibles set out in Part C of the Annex to this Schedule and the revised higher deductibles for the Contract Works Insurance or the Employers' Liability Insurance ( as the case may be ) and shall indemnify Infraco ( on its own behalf and/or as agent for the other insured parties under its Contract Works Insurance or its Employers' Liability Insurance ) from and against any Losses suffered or incurred by Infraco and/or any other insured parties under the Contract Works Insurance or Employers' Liability Insurance to the extent of, or up to ( as the case may be ), the difference between the relevant deductibles set out in Part C of the Annex to this Schedule and the revised higher deductibles paid by Infraco or another insured party in any year at the end of such year.

3.7 Notwithstanding the provisions of paragraph 3.6, if at any time in any year, and then each time in any year that, the amount of the difference between the relevant deductibles for Infraco's Contract Works Insurance or its Employers' Liability Insurance ( as the case may be ) set out in Part C of the Annex to this Schedule and the revised higher deductibles paid by Infraco or another insured party for the Contract Works Insurance or the Employers' Liability Insurance ( as the case may be ) shall, in accordance with paragraph 3.6, exceed in aggregate £500,000 or shall thereafter exceed in aggregate £500,000 then each time such difference exceeds £500,000 in accordance with paragraph 3.6, LUL shall be liable for such difference in accordance with paragraph 3.6 and at the end of such year the amount for which LUL is liable in respect of that year shall be reduced by any such amounts already paid by LUL in that year.

3.8 For the avoidance of doubt, nothing in this Schedule 5.19 shall limit Infraco's obligation to take out and maintain Contract Works Insurance or Employers' Liability Insurance in accordance with this Schedule 5.19 or the Insurance Agreement notwithstanding any increase in insurance premiums, insurance premium tax, insurance brokerage or fees or deductibles where such increase is due to its negligence or default in performance of its obligations under the Contract or the Insurance Agreement, or this Schedule 5.19.

Review

4.1 Subject to paragraph 4.2, any limits and deductibles in respect of Contract Works Insurance shall be maintained throughout the duration of the Contract unless otherwise agreed between LUL and Infraco or unless such insurance is no longer available on commercially acceptable terms.

4.2 On every Review Date LUL and Infraco shall review and determine the cover to be provided under, and the limits of, the Contract Works Insurance with effect from the next renewal date after such Review Date. The limits and/or deductibles may be increased or decreased more frequently if agreed by LUL and Infraco ( each acting reasonably ). If LUL and Infraco fail to so agree, such failure to agree shall not constitute a Dispute and the Dispute Resolution Agreement shall not apply.

Contracts

5.1 Subject to paragraph 5.2 Infraco shall procure that any Key Sub-Contract ( other than any Key Sub-Contract relating to risks and liabilities to the extent covered by the Contract Works Insurance but including maintenance, cleaning and other service contracts save where the Key Sub-Contractor is a Supply Chain Contractor ( as defined in paragraph 5.2 ) where the Contract Works Insurance applies ) entered into by Infraco shall contain provisions which require the Key Sub-Contractor to effect and maintain insurance under the Key Sub-Contract as would be effected and maintained by Infraco exercising Good Industry Practice in circumstances where otherwise Infraco would be paying for and arranging such insurance.

5.2 For the purposes of paragraph 5.1: (a) the threshold of £1,000,000 ( subject to indexation in accordance with Schedule 4.2 ( Indexation ) of the Contract ) set out in the definition of Key Sub-Contract, and thereby applying to the definition of Key Sub-Contractor, shall not apply; and

(b) and for the purposes of paragraphs 2 and 3 of Part A of the Annex to this Schedule, Supply Chain Contractor shall mean each and any of Balfour Beatty plc ( ( company registration number 00395826 ) whose registered office is at 130 Wilton Road, London SW1V 1LQ ), Balfour Beatty Group Limited ( ( company registration number 00101073 ) whose registered office is at Fourth Floor, 130 Wilton Road, London SW1V 1LQ ), Balfour Beatty Rail Projects Limited ( ( company registration number 00772437 ) whose registered office is at 7 Mayday Road, Thornton Heath, Surrey CR7 7XA ), Balfour Beatty Construction Limited ( ( company registration number SC106247 ) whose registered office is at Croythorn House, 23 Ravelston Terrace, Edinburgh EH4 3TN ), Bombardier Inc. ( a company incorporated under the Canada Business Corporations Act with registered number 386107-4 whose registered office is at 800 Rene-Levesque Boulevard ( West ), 29^th Floor, Montreal, Quebec, Canada H3B 1Y8 ), Bombardier Transportation UK Limited ( ( company registration number 02235994 ) whose registered office is at Litchurch Lane, Derby, Derbyshire DE24 8AD ), Seeboard Group plc ( ( company registration number 03189877 ) whose registered office is at Forest Gate, Brighton Road, Crawley, West Sussex RH11 9BH ), Seeboard Trading Limited ( ( company registration number 03267621 ) whose registered office is at Forest Gate, Brighton Road, Crawley, West Sussex RH11 9BH ), Seeboard Contracting Services Limited ( ( company registration number 02965182 ) whose registered office is at Forest Gate, Brighton Road, Crawley, West Sussex RH11 9BH ), Thames Water plc ( ( company registration number 02366623 ) whose registered office is at 14 Cavendish Place, London W1G 9NU ), Thames Water Services Limited ( ( company registration number 02518607 ) whose registered office is at Clearwater Court, Vastern Road, Reading, Berkshire RG1 8DB ), WS Atkins plc ( ( company registration number 01885586 ) whose registered office is at Woodcote Grove, Ashley Road, Epsom, Surrey KT18 5BW ), WS Atkins Rail Limited ( ( company registration number 01026689 ) whose registered office is at Woodcote Grove, Ashley Road, Epsom, Surrey KT18 5BW ) and Trans4m ( ( company registration number 04362810 ) whose registered office is at One Creed Court, 5 Ludgate Hill, London EC4M 7AA ) and/or ( subject to LUL's prior consent ( such consent not to be unreasonably withheld or delayed ) ) Affiliates of the same.

THE ANNEX

Part A - Contract Works Insurance

Section 1 - Construction/Erection 'All Risks' Insurance

Property Insured

1 Contract works being the permanent and temporary works relating to the supply, execution, delivery, construction, installation, erection and/or setting to work, testing and commissioning of the Contract including all materials, equipment and plant for incorporation therein, brought onto the Operational Property for the purpose of the Contract, including inland transits and storage outside the Operational Property.

Cover

1.2 Physical loss of or damage to the Property Insured howsoever caused, other than as specifically excluded, occurring during the performance of the Contract at: (a) the Operational Property or temporary storage areas; or

(b) during transit within United Kingdom to or from the Operational Property or temporary storage areas.

Insureds

1.3 (a) Infraco and its respective assigns, directors, employees, servants and agents;

(b) the shareholders from time to time of:
(i) Infraco; and

(ii) the immediate parent company of Infraco,
in their capacity as shareholders of such companies;

(c) any person who is providing, or who acts as agent, trustee or account bank in respect of the provision of, financing, hedging or funding ( including without limitation provision of a financial guarantee ) to an Infraco ( or to an Affiliate of an Infraco who is then providing financing, hedging or funding to that Infraco ) and its assigns, directors, employees, servants and agents;

(d) Metronet Rail BCV Finance plc, Metronet Rail BCV Intermediate Limited and their respective directors, employees, servants assigns and agents;

(e) the contractor;

(f) all other contractors and/or sub-contractors of whatsoever tier engaged in carrying out works on/at the Operational Property;

(g) LUL Parties;

(h) Other Infraco Parties;

(i) architects, engineers, consultants and suppliers appointed to carry out work on or in connection with the Contract;

(j) ( In the case of SSL ) REW ( Acton ) Limited ( for so long as it is a subsidiary of SSL ) and its respective directors, employees, servants and agents;

(k) ( In the case of BCV ) TMU ( Acton ) Limited ( for so long as it is a subsidiary of BCV ) and its respective directors, employees, servants and agents.

In each of the above cases for their respective interest in the PPP.

Sum Insured

1.4 Limit in respect of any one occurrence; £70,000,000 ( or such other amount as may be agreed between the parties except in the first period of insurance after the Transfer Date in which the limit in respect of any one occurrence will be £40,000,000 ).

Deductible

1.5 The first £10,000 of each and every occurrence of loss destruction or damage, but £150,000 in respect of DE5 ( 1995 ) defects cover.

Principal Extensions

1.6 (a) Automatic reinstatement of sum insured clause;

(b) Automatic increase in sum insured - up to 15% of value at time of award;

(c) Professional fees clause;

(d) Debris removal expenses ( limit 10% of claim );

(e) Expenses to minimise a loss clause ( limit 10% of value of contract, maximum £2,500,000 );

(f) Plans and specifications clause ( limit £500,000 );

(g) 72 hours clause;

(h) Expediting expenses clause ( limit 20% of claim );

(i) Riot, strike or civil commotion damage;

(j) Damage to existing property actually being worked upon, ( limit £1,000,000 any one occurrence );

(k) Full cover for damage from terrorism;

(l) Additional costs of working as a result of an insured event, limit £2,500,000 with a 20% coinsurance;

(m) Increased costs of completing un-built parts, limit £2,500,000 with a 20% coinsurance;

(n) Waiver of subrogation clause;

(o) Cross liabilities clause;

(p) Non-vitiation clause;

(q) Primary insurance.

Principal Exclusions (a) Damage to plant resulting from experiments or overload or similar tests requiring the imposition of abnormal conditions ( other than overload or similar tests carried out with the approval of the manufacturer or by normal rules of good operational practice );

(b) The costs of normal upkeep or normal making good;

(c) Repairing or replacing or rectifying works which are defective in material, workmanship, design or specification - DE5 ( 1995 ) or equivalent defects cover;

(d) Damage to any mechanically propelled vehicle licensed for road use;

(e) Normal wear and tear, gradual deterioration, corrosion and erosion ( but cover to include physical damage caused by a resulting accident );

(f) Damage occurring during sea or air transit;

(g) Damage to construction equipment, temporary buildings or contents ( not otherwise forming part of the permanent works );

(h) War, invasion, act of foreign enemy, hostilities, civil war, rebellion, revolution, insurrection, military or usurped power, confiscation, requisition, sequestration, nationalisation or similar act;

(i) Radioactive contamination;

(j) Sonic bangs;

(k) Deliberate acts or omissions of the insured party claiming indemnity;

(l) Unexplained shortages;

(m) Damage to any marine vessel or craft or aircraft;

(n) Loss of money, cash, deeds, bonds and the like;

(o) Fire prevention - joint code of practice clause;

(p) Loss of or damage to rolling stock;

(q) Pollution or contamination except as a result of malicious act or of terrorism, fire, spontaneous combustion, lightning, aircraft, aerial devices, explosion, riot, civil commotion, strikers, locked out workers, earthquake, subterranean fire, storm, tempest, flood, escape of water from any tank, pipes or apparatus, leakage from any sprinkler or other extinguishing system or impact by vehicles including rolling stock or animal.

Section 2- Third Party Liability

Cover

2.1 To indemnify the insureds against legal liability to pay compensation ( including claimants' costs fees and expenses ) consequent upon: (a) bodily injury to or illness or death of any person;

(b) loss of or damage to any third party property, including negligent loss, destruction or damage to LUL or Infraco property worked upon or in the care, custody or control of the contractor or any other contractors and/or sub-contractors of any tier;

(c) trespass, nuisance, obstruction, loss of amenities and the like,

occurring in connection with the performance of the Contract, including inspection and investigation work, at the Operational Property or elsewhere in United Kingdom.

Insureds

2.2 (a) The contractor;

(b) All other contractors and/or sub-contractors of whatsoever tier engaged in carrying out works at the Operational Property;

(c) Architects, engineers and consultants appointed to carry out work on or in connection with the Contract for their activities at the Operational Property;

(d) Any person who is providing, or who acts as agent, trustee or account bank in respect of the provision of, financing, hedging or funding ( including without limitation provision of a financial guarantee ) to an Infraco ( or to an Affiliate of an Infraco who is then providing financing, hedging or funding to that Infraco ) and its assigns, directors, employees, servants and agents;

(da) Metronet Rail BCV Finance plc, Metronet Rail BCV Intermediate Limited and their respective directors, employees, servants, assigns and agents;

(e) Infraco ( in respect of its interest as supply chain principal only );

(f) TMU ( Acton ) Limited ( for so long as it is a subsidiary of BCV );

(g) The shareholders from time to time of:
(i) Infraco; and

(ii) the immediate parent company of Infraco,

in their capacity as shareholders of such companies;
(h) Directors, officers, employees and agents of the above.

In each of the above cases for their respective interest in the PPP.

Maintenance and/or cleaning contracts are not covered under this third party liability section of the cover unless the contractor is a Supply Chain Contractor.

Limit of Indemnity

2.3 £25,000,000 any one occurrence and in the aggregate for products liability and pollution.

Deductible

2.4 The first £10,000 of each and every claim for damage to property.

Nil for bodily injury claims.

Principal Extensions

2.5 (a) Cross liability clause;

(b) Waiver of subrogation clause;

(c) Products liability including completed operations cover;

(d) Costs and expenses clause;

(e) Sudden and accidental seepage and pollution;

(f) Health and safety at work clause;

(g) Officers and members of first aid and other sports, social or welfare organisations;

(h) Non-vitiation clause;

(i) Indemnity to principal clause;

(j) Contractual liability ( as, for the avoidance of doubt, an inclusion ).

Principal Exclusions

2.6 (a) Pollution and/or contamination other than sudden, accidental, identifiable events, NMA 1685 exclusion or equivalent;

(b) Deliberate acts unless such act(s) is/are committed for the purposes of the protection of persons or property;

(c) Fines and punitive damages;

(d) Radioactive contamination;

(e) Damage to project works and property belonging to the insured seeking indemnity;

(f) Motor vehicle liability/road traffic legislation insurance;

(g) Liability arising from the use or ownership of aircraft, vessels or watercraft;

(h) Death of or injury to employees of the insured seeking indemnity;

(i) Penalties or liquidated damages;

(j) Claims for professional negligence ( other than property damage or bodily injury ).

Section 3 - Professional Indemnity

Cover

3.1 To indemnify the Insured against their legal liability arising out of negligence in the performance of professional activities, including with regard to their sub-contractors and design team.

Insureds

3.2 (a) Infraco;

(b) TMU ( Acton ) Limited ( for so long as it is a subsidiary of BCV );

(c) the Supply Chain Contractors;

(d) other contractors, sub-contractors, architects, engineers and consultants engaged in design or related professional work. In each of the above cases for their respective interest in the PPP.

Limit of Indemnity

3.3 £50,000,000 any one claim and in the aggregate per annum plus one reinstatement of the sum insured.

Deductible

3.4 The first £250,000 of each and every claim.

Principal Extensions

3.4A (a) Criminal prosecution defence costs

(b) Infringement of intellectual property rights

(c) Dishonesty of employees

(d) Liability for loss of documents

(e) Libel and slander

(f) Prior to handover costs cover

(g) Adjudication

(h) Cross liability clause

(i) World-wide jurisdiction

Principal Exclusions

3.5 (a) dishonest or fraudulent claims;

(b) design or manufacture of products for mass sale;

(c) express warranty or guarantee;

(d) bodily injury or property damage;

(e) insolvency of an insured;

(f) asbestos;

(g) pollution.

Part B - Anticipated Insurance Costs

( paragraphs 3.3 and 3.4 of this Schedule 5.19 )

1. Contracts Works Insurance

(a) Construction/erection "All Risks"

Year 1	540,000
Year 2	505,775
Year 3	637,957
Year 4	557,526
Year 5	727,401
Year 6	586,242
Year 7	644,265
Year 7.5	300,364

(b) Third Party Liability

Year 1	750,000
Year 2	643,046
Year 3	1,056,116
Year 4	804,769
Year 5	1,335,628
Year 6	894,507
Year 7	1,075,828
Year 7.5	469,889

Year 1	70,000
Year 2	70,000
Year 3	70,000
Year 4	70,000
Year 5	70,000
Year 6	70,000
Year 7	70,000
Year 7.5	35,000

2. Employers' Liability Insurance

Year 1	550,000
Year 2	521,704
Year 3	495,245
Year 4	476,246
Year 5	458,389
Year 6	438,202
Year 7	431,848
Year 7.5	205,683

3. Aggregate of the Anticipated Insurance Costs

Year 1	1,910,000
Year 2	1,740,525
Year 3	2,259,318
Year 4	1,908,541
Year 5	2,591,417
Year 6	1,988,952
Year 7	2,221,941
Year 7.5	1,010,936

Note: Anticipated Insurance Costs include anticipated premium, insurance premium tax, and insurance brokerage and fees.

Part C - Applicable Deductibles

	Insurance	Deductible
1.	Contract Works Insurance
(a)	Construction/Erection "all risks" ( para 1 of Part A of this Annex )	The first £10,000 of each and every occurrence of loss, destruction or damage, but £150,000 in respect of DE5 ( 1995 ) defects cover.
(b)	Third Party Liability ( para 2 of Part A of this Annex )	The first £10,000 of each and every claim for damage to property. Nil for bodily injury claims.
(c)	Professional Indemnity ( para 3 of Part A of this Annex )	The first £250,000 of each and every claim.
2.	Employers' Liability Insurance	Nil.

PPP Contracts

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