Coverage C of the Institute Marine Cargo Clauses

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Russian: Оговорка C Института Лондонских Страховщиков по страхованию грузов


Coverage C is the last from three general Institute Marine Cargo Clauses. It is also a "named perils" policy[1], as it lists specifically the risks that it will cover. The list of covered perils is limited to fire, stranding, sinking, collision, and jettison; it does not include washing overboard, rough weather damages, or water damages and losses during loading and unloading. For a complete list, please refer to Table 1 below, where a comparison is given for all six standard coverages. Coverage C is the minimum coverage required by the Incoterms CIF (Cost, Insurance, And Freight) and CIP (Carriage And Insurance Paid To). It is minimal enough as to be inappropriate for most goods, and trading/industrial companies doing business on the said CIF or CIP terms should definitely extend this coverage to "maximum cover" (i.e., Coverage A of the Institute Marine Cargo Clauses), or, if they are importing on those Incoterms, purchase Difference in Condition Insurance. Coverage C is generally insufficient for most containerized goods, with the possible exception of goods that are unlikely to be affected by an international voyage in any way, and, if lost overboard, would not be a major loss. There are few cargos that fit this description, with the possible exception of scrap merchandise, such as scrap metal or recyclable paper. Coverage C is appropriate for bulk cargo, as it is unlikely to experience a loss unless there is major damage to the ship.[2]

Table 1. Marine Insurance Coverage Summary

Perils Covered Against Coverage A of the Institute Marine Cargo Clauses Coverage B of the Institute Marine Cargo Clauses Coverage C of the Institute Marine Cargo Clauses All Risks Coverage With Average (Typical Coverage) Free of Particular Average (Typical Coverage)
Fire YES YES YES YES YES YES
Explosion YES YES YES YES YES YES
Stranding YES YES YES YES YES YES
Sinking YES YES YES YES YES YES
Collision YES YES YES YES YES YES
General Average YES YES YES YES YES YES
Jettison YES YES YES YES YES [3]
Loss Overboard YES YES YES YES [3]
Seawater Damage YES YES YES YES [3]
Lightening YES YES YES YES [3]
Condensation YES YES
Improper Stowage by Carrier YES YES
Theft YES YES
Pilferage YES YES
Leakage YES YES
Breakage YES YES
Damage While Loading/Unloading YES YES YES YES
Damage on land Before Loading YES YES YES YES YES YES

References

  1. Dunt, J. Marine Cargo Insurance, 2009 - Ch.9. // http://www.i-law.com/ilaw/doc/view.htm?id=241465
  2. David, P., Stewart, R. International Logistics: The Management of International Trade Operations - Thomson: Mason, Ohio. 2007 - http://www.atomicdogpublishing.com/home.asp
  3. 3.0 3.1 3.2 3.3 Under an FPA policy, any partial loss incurred would not be covered unless it is due to a ship sinking, burning, becoming stranded, or being involved in a collision; a total loss would be covered
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