Institute Cargo Clauses A, B and C: differences and how to choose

Last reviewed: 28 July 2026

The Institute Cargo Clauses A, B and C determine which losses or damage may be considered under many international cargo policies. ICC A has the broadest structure but still contains exclusions; ICC B and C respond only to listed perils. A sound choice requires an assessment of the goods, packing, route, transport modes, Incoterm, limits and every endorsement attached to the policy.

What are the Institute Cargo Clauses?

The Institute Cargo Clauses, usually abbreviated to ICC, are cargo insurance wordings developed for the international market by the Lloyd’s Market Association and the International Underwriting Association. The three general wordings dated 1 January 2009 are:

• Institute Cargo Clauses (A), CL382.

• Institute Cargo Clauses (B), CL383.

• Institute Cargo Clauses (C), CL384.

They are not three complete insurance products that are identical in every market, nor are they legislation. They are contractual wordings that may be incorporated into a policy and supplemented or amended by the schedule, deductibles, limits, special clauses and endorsements.

In Spain, the Spanish Maritime Navigation Act 14/2014 governs marine insurance and generally allows the parties to agree the cover they consider appropriate. The ICC wording must therefore be read together with the policy, certificates, endorsements and applicable law.

The essential difference between ICC A, B and C

The main difference is not simply that one option contains “more risks” than another. The structure of the cover itself changes.

ICC A: insured risks subject to exclusions

ICC A covers risks of loss of or damage to the insured cargo, except those excluded by the wording or other policy terms. This is why it is often described commercially as “all risks”.

That expression can be misleading. It does not mean that every loss, deterioration, cost or commercial failure is covered. There must be loss of or damage to the cargo during the insured transit and no applicable exclusion or limitation must prevent recovery.

ICC B: intermediate named-perils cover

ICC B covers loss or damage reasonably attributable to, or caused by, the events in its list. In addition to the major transport accidents included in ICC C, it addresses certain additional events: earthquake, volcanic eruption or lightning; washing overboard; entry of sea, lake or river water; and total loss of a package dropped during loading onto or unloading from the vessel.

Causation is critical. Showing that the goods arrived damaged is not enough. The loss must be connected with a listed peril, always subject to the exclusions and remaining policy terms.

ICC C: more limited named-perils cover

ICC C concentrates on major transport accidents: fire or explosion; vessel or craft being stranded, grounded, sunk or capsized; overturning or derailment of a land conveyance; collision or contact with an external object; and discharge at a port of distress. It also includes general average sacrifice and jettison.

It should not be treated as general cover for any damage suffered during the journey. Wet damage from water ingress, theft, handling damage or partial shortage, for example, are not listed ICC C perils unless the damage results from an insured event or an applicable extension has been added.

Comparison of the insured perils

This table compares the structure of the standard 1/1/2009 wordings. ICC A starts from broad cover, while ICC B and C require loss or damage to result from one of the listed perils. It does not replace the clauses or any amendments in the specific policy.

Loss or damage associated with	ICC A	ICC B	ICC C
Fire or explosion	Broad cover*	Listed peril*	Listed peril*
Stranding, sinking or capsizing	Broad cover*	Listed peril*	Listed peril*
Overturning or derailment of land conveyance	Broad cover*	Listed peril*	Listed peril*
Collision or contact with an external object	Broad cover*	Listed peril*	Listed peril*
Discharge at a port of distress	Broad cover*	Listed peril*	Listed peril*
Earthquake, volcanic eruption or lightning	Broad cover*	Listed peril*	Not listed*
Jettison or general average sacrifice	Broad cover*	Listed peril*	Listed peril*
Washing overboard	Broad cover*	Listed peril*	Not listed*
Entry of sea, lake or river water	Broad cover*	Listed peril*	Not listed*
Total loss of package dropped during vessel loading or unloading	Broad cover*	Listed peril*	Not listed*
Accidental breakage, theft or shortage unrelated to a listed peril	May fall within scope*	Not listed*	Not listed*

Note: no cell means that cover applies automatically. All three wordings remain subject to the policy exclusions, conditions, deductible, limits and endorsements, as well as the applicable law. Under ICC A, loss or damage during the insured transit must be established; under ICC B and C, the cause must also correspond to a listed peril.

All three wordings include general average and salvage charges on the terms set out in the clauses where connected with a non-excluded cause.

“All risks” does not mean “everything is covered”

Exclusions must be reviewed even where ICC A applies. Matters that commonly require particular attention include:

• wilful misconduct of the Assured;

• ordinary leakage, loss in weight or volume, and ordinary wear and tear;

• insufficient or unsuitable packing or preparation in the circumstances

described by the wording;

• inherent vice or the nature of the goods;

• loss, damage or expense caused by delay;

• specified insolvency or financial-default situations involving the carrier;

• unseaworthiness or unfitness of the vessel, vehicle or container where the

conditions of the exclusion are met;

• war, capture, seizure, strikes, riots, terrorism and political risks unless

additional applicable cover has been arranged;

• nuclear risks and any further exclusions added to the policy.

Spanish maritime law also excludes, as a general rule, inherent vice, the intrinsic nature of the insured property and natural wear. Consequential loss, delay, loss of market and loss of profit require separate analysis and should not be assumed to form part of physical cargo insurance.

A policy may contain special clauses for war, strikes, refrigerated cargo, refrigeration breakdown, rejection, contamination, cyber risk, deck cargo or other exposures. Their existence and scope must be verified; they do not follow automatically from the letter A, B or C.

How to choose according to the goods

The decision should not start with the premium alone. The better question is how the goods could be damaged and which causes could be proved after a loss.

Machinery, equipment and high-value cargo

Handling breakage, impact, theft, wet damage and loss of components may occur without a major transport accident. ICC A will often be a more coherent basis for this profile, but packing, per-package limits, replacement parts, depreciation, deck carriage and survey requirements still need to be reviewed.

Electronics and moisture-sensitive goods

Water ingress matters, but it is not the only exposure. Condensation, corrosion, temperature changes, poor packing and damage with no external signs can create causation disputes. ICC B addresses specified water ingress; ICC A is broader, although exclusions may still be decisive under both.

Food, refrigerated goods and pharmaceuticals

ICC A alone does not turn every temperature deviation, delay, deterioration or loss of shelf life into insured damage. Temperature or refrigeration clauses, the maximum interruption period, equipment records, packing, product nature and transport protocols must be checked.

Bulk cargo and raw materials

ICC C may be used as a minimum contractual basis in some commodity trades, particularly CIF transactions. Contamination, wet damage, shortage, mixing, heating, rejection and the characteristics of the commodity must nevertheless be assessed. Some commodities require specialist wordings rather than a mechanical choice between ICC A, B and C.

Used or refurbished goods

Pre-shipment condition and the difficulty of separating new damage from wear or pre-existing defects justify tailored conditions, documented valuation, photographs and inspection. Choosing ICC A does not remove that evidential need.

The route and logistics also affect the decision

A useful review describes the real transit, not only the ports of departure and arrival:

• origin and destination warehouses;

• road, rail, sea and air legs;

• consolidation and deconsolidation;

• transhipments and intermediate ports;

• temporary storage;

• deck or under-deck carriage;

• war, strike or high-theft areas;

• season and weather exposure;

• accumulation limits on one vessel, at a port or in a warehouse.

Spanish maritime law extends its cargo-insurance rules to other transport modes where they are ancillary to the sea voyage. Where a policy contains a warehouse-to-warehouse clause, cover extends between the places defined in that policy. This does not mean that every storage period or deviation is covered without limit: attachment, termination, the ordinary course of transit and notification requirements must be checked.

The relationship between ICC, CIF and CIP

Incoterms® rules allocate certain obligations, costs and risks between buyer and seller. They do not replace the insurance policy or guarantee that its cover is adequate for the transaction.

Under Incoterms® 2020:

• CIF requires the seller by default to obtain cover equivalent to ICC C,

unless the parties agree a higher level.

• CIP requires cover equivalent to ICC A by default, unless the parties

agree otherwise.

This distinction matters. A buyer may receive a formally compliant CIF certificate and still find that theft, handling damage or water ingress without an insured accident does not fit ICC C. The sale contract should therefore specify the wording, extensions, insured value, route and the party to be named as insured or beneficiary.

The risk-transfer point must also be identified. Under CIF and CIP, the seller may pay carriage and insurance to the agreed destination while commercial risk passes earlier. Carriage cost, transfer of risk and insurance duration are related but separate concepts.

Checklist for choosing the cover

Before placing insurance or accepting a certificate, ask:

1. Who bears the risk under the sale contract and Incoterm?

1. What are the goods and how can they realistically be damaged?

1. Are they new, used, fragile, perishable, refrigerated or high-value?

1. How are they packed and who performs the preparation?

1. What is the complete route, including transhipments and storage?

1. Which version and date of the ICC wording applies?

1. Which policy terms amend the standard wording?

1. Are war, strikes, theft, temperature, rejection, deck cargo or specialist

extensions required?

1. What is the insurable value, deductible and limit per shipment, package,

vehicle, vessel or location?

1. Exactly when does cover attach and terminate?

1. Which documents and time limits apply to a claim?

1. Which law and jurisdiction govern?

What to check in the policy and certificate

The ICC letter should never be reviewed in isolation. The final document may also contain:

• description and value of the goods;

• declared journey and transport modes;

• exact version of the clauses;

• deductible and limits;

• additional exclusions;

• warranties or conditions precedent;

• commodity-specific clauses;

• transit duration;

• notification procedure;

• survey agent;

• governing law and jurisdiction;

• insured party, beneficiary and transferability of the certificate.

For an open or floating policy, declarations, the maximum amount per shipment and notification periods also require attention. Under Spanish law, accurate disclosure of material circumstances and aggravations of the risk may have significant consequences.

What to do if loss or damage occurs

First protect people and take reasonable measures to avert or minimise the loss without prejudicing rights against the carrier or other responsible parties. In practice:

• notify the insurer, broker or survey agent immediately;

• issue clear reservations to the carrier and observe protest time limits;

• preserve packing, seals, data loggers, photographs and damaged goods;

• segregate affected cargo where safe and reasonable;

• record the place, date, apparent cause and measures taken;

• collect the commercial invoice, packing list, transport document, policy or

certificate, delivery record and loss valuation;

• do not dispose of the goods or release third parties without considering the

effect on the claim and subrogation rights.

For contracts governed by the Spanish Maritime Navigation Act, article 426 provides for notification within seven days of knowledge of the loss and qualifies the consequences of late notice. The policy, transport mode and third-party claim may require different and shorter steps. Immediate notice is the prudent course.

Nautilux provides further information on marine claims management.

Frequently asked questions

Does ICC A cover every cargo loss?

No. It is the broadest standard structure, but it requires loss of or damage to the goods during the insured transit and remains subject to exclusions, deductibles, limits, policy terms and endorsements.

Does ICC B cover theft?

Theft is not a separate listed peril in the standard core of ICC B. Cover might exist if the loss results from another insured peril or an applicable extension has been added. The complete wording must be reviewed.

Is ICC C sufficient for a CIF sale?

It may satisfy the default minimum insurance level under CIF Incoterms® 2020. That does not establish that it is adequate for the particular goods and route. Buyer and seller may agree broader cover.

Does ICC A include war and strikes?

Not automatically. The ordinary wordings contain separate exclusions for war and strikes. Additional clauses are commonly considered, subject to their own terms, territories and cancellation provisions.

Does warehouse-to-warehouse cover every storage period?

Not necessarily. The declared places, ordinary course of transit, storage chosen by the Assured, changes of destination and termination periods must be checked.

Does carrier liability replace cargo insurance?

No. Carrier liability depends on the contract, transport mode, cause and legal or contractual limits. It may be lower than the cargo value or may not arise. Cargo insurance protects a different interest, after which recovery against a responsible party can be considered.

How Nautilux can assist

Choosing between ICC A, B and C should form part of a broader risk review. Nautilux Marine Broker can assess the goods, values, packing, route, transport modes, Incoterm and required extensions before seeking terms from the market.

Visit our marine cargo insurance service or request a review of the risk and a proposal suited to the transaction.

*General information reviewed on 28 July 2026. It is not legal advice and does not confirm cover for a particular loss. Cover depends on the policy, certificate, endorsements, facts, cause of loss and applicable law.*