Marine cargo insurance for exporters: ICC A, B, C and who insures

This guide is for exporters who need to know when they must insure the goods in transit, what cover to buy and how to claim. It covers the Institute Cargo Clauses, war and strikes cover, types of policy, the sum insured, who insures under each Incoterm, and the claims and survey process.

What marine cargo insurance does

Marine cargo insurance pays for physical loss of or damage to goods in transit by sea, air, road or rail. It is separate from ECGC credit insurance, which covers the buyer not paying. You can need both on the same shipment. Policies are sold by IRDAI-registered general insurers, and most export cover is written on the Institute Cargo Clauses (ICC) 2009, used worldwide.

ICC (A), (B) and (C)

Clauses	What is covered
ICC (C), minimum cover	Named major perils only: fire or explosion; the vessel stranded, grounded, sunk or capsized; overturning or derailment of land conveyance; collision of the vessel with an external object; discharge at a port of distress; general average sacrifice; jettison
ICC (B), intermediate	Everything in (C), plus earthquake, volcanic eruption or lightning; washing overboard; entry of sea, lake or river water into the vessel, container or place of storage; total loss of a package lost overboard or dropped while loading or unloading
ICC (A), widest	All risks of loss or damage, except the listed exclusions

All three exclude, among other things, wilful misconduct, ordinary leakage and wear and tear, insufficient or unsuitable packing done by you or your staff, inherent vice of the goods, delay, and losses from the insolvency or financial default of the shipowner. Malicious damage is covered under (A) but excluded under (B) and (C). Packing is where many exporter claims fail, so pack and stuff containers for the whole journey.

Cover normally runs warehouse to warehouse: it starts when the goods are first moved at your premises for loading and ends at the earliest of delivery to the final warehouse, delivery to another place used for storage or distribution, or 60 days after discharge from the ocean vessel at the final port.

War and strikes

War, strikes, riots, civil commotion and terrorism are excluded from ICC (A), (B) and (C). You add them with the Institute War Clauses (Cargo) and the Institute Strikes Clauses (Cargo), usually for extra premium. War cover generally applies only while the goods are on the ocean vessel (or aircraft), not on land; strikes cover follows the warehouse-to-warehouse transit. For routes through conflict areas, ask your insurer for the current war rate before you quote a CIF or CIP price.

Specific policy or open cover

• Specific (single voyage) policy: covers one shipment, arranged before it moves. Suits occasional exporters.
• Open cover: an agreement under which the insurer covers all your export shipments within agreed limits; you declare each shipment and get a certificate of insurance for it. Suits regular exporters and avoids the risk of forgetting a shipment.
• Open policy or sales turnover policy: annual policies, often also covering inland transits, with premium on estimated turnover adjusted against declarations, or with no per-shipment declarations at all under some turnover policies.

Arrange cover and pay the premium before the goods move. Cover cannot be bought for a loss that has already happened.

How much to insure

For CIF and CIP sales, Incoterms 2020 require cover of at least the contract price plus 10% (110%), in the currency of the contract. Under UCP 600, if a letter of credit does not state the amount, the insurance document must cover at least 110% of the CIF or CIP value, and it must be dated no later than the shipment date. Indian insurers commonly agree a value of CIF plus 10%, sometimes more, to cover incidental costs and expected profit. Always follow the LC or contract if it asks for more.

Who insures under each Incoterm

Incoterm	Main carriage risk	Insurance obligation
EXW, FCA	Buyer, from delivery at your premises or to the carrier	None; buyer usually insures
FAS, FOB	Buyer, from alongside or on board at the Indian port	None; you carry the risk to the port, so insure the inland leg
CFR, CPT	Buyer, from shipment or handover to the first carrier	None; buyer insures, though you pay freight
CIF	Buyer, from loading on board	You must insure for the buyer's benefit, minimum ICC (C)
CIP	Buyer, from handover to the first carrier	You must insure, minimum ICC (A) or similar
DAP, DPU, DDP	You, until delivery at destination	No obligation, but you carry the risk, so insure

On FOB or CFR sales on DP or DA terms, you may still be out of pocket if goods are damaged and the buyer refuses the documents. Ask your insurer whether a seller's interest (contingency) cover is available.

Making a claim

1. Act to limit the loss. The policy expects you or the consignee to take reasonable steps to minimise loss.
2. Notify the insurer or its claims agent at once. The certificate of insurance names the agent abroad to contact for a survey.
3. Arrange a survey before the goods are moved or repaired. In India, the insurer appoints a licensed surveyor; abroad, the named claims agent arranges one. Do not destroy damaged goods until the surveyor allows it.
4. Protect the right against the carrier. Do not give a clean receipt for damaged cargo. Give the carrier written notice at once: under the Hague-Visby Rules used in most bills of lading, notice is due at delivery, or within three days if the damage is not apparent, and suit must be brought within one year. Air cargo damage must be reported to the airline within 14 days of receipt under the Montreal Convention.
5. Submit the documents: claim letter, original policy or certificate, invoice, packing list, bill of lading or airway bill, survey report, carrier or port damage or shortage certificate, a copy of the notice to the carrier and its reply, and photographs. The insurer will ask for a letter of subrogation so it can recover from the carrier.

Common mistakes

• Leaving the inland leg to the port uninsured on FOB sales.
• Insuring under ICC (C) when the buyer or LC expected (A).
• Insurance certificate dated after the bill of lading under an LC.
• Missing the short notice deadlines against the carrier.

Related on Exportsmitra

• Policies and licences with renewal reminders
• Incoterms 2020 for Indian exporters: which term, who pays, who insures
• Export quote builder
• Letters of credit: a checklist to avoid discrepancies under UCP 600

Sources

• ICC: Incoterms 2020
• ICC: trade finance rules, including UCP 600
• Institute Cargo Clauses (B) 1/1/09, CL383 (PDF, insurer copy)
• New India Assurance: marine specific voyage policy customer information sheet (PDF)
• Zurich Kotak General Insurance: marine cargo insurance prospectus (PDF)
• Hague Rules on bills of lading, text (University of Oslo treaty library)

Last checked 1 October 2026. Rules change: confirm with your insurer or broker before you act.