What are Institute Cargo Clauses in Marine Cargo Insurance?

Institute Cargo Clause in Marine Cargo Insurance

There are mainly three clauses in institute cargo clauses. The coverage of these clauses explicitly pertains to the marine insurance premium. The coverage can extend to various elements, encompassing both the cargo itself, the container holding it, and even the transportation means employed for shipping the goods. Each category of clause, namely A, B, and C, delineates the extent of coverage provided, with Clause C being the most limited and Clause A offering the most comprehensive coverage.

These clauses offer different kinds of coverage, which may be higher or lower.

Let us discuss the institute cargo clause in marine cargo insurance in detail.

1. Institute Cargo Clause A

   Institute cargo clause A offers the widest coverage among the other institute cargo clauses. Accordingly, the institute cargo clause is also known as the "All Risks' cargo insurance policy. Hence, it is the most expensive insurance policy among other institute cargo clauses.

2. Institute Cargo Clause B

   Institute cargo clause B offers some restrictive coverage compared to institute cargo clause A.. Institute cargo clause b provides coverage for accidental damages only. Therefore, the policyholder may expect to allocate a moderate premium. Further, the policyholder may seek more coverage in order to protect valuable items.

3. Institute Cargo Clause C

   Institute cargo clause C offers the most restrictive coverage out of all three clauses. It offers coverage against limited risks. You will have to check the policy documents to learn about the coverage in detail.

   *Note: The coverages offered by the insurance policy varies from insurer to insurer, so make sure to check the policy documents and see if the insurance plan is providing the kind of coverage you want.

Conclusion

The institute cargo clauses offer different kinds of coverage. Clause A offers the widest coverage to the policyholder. Clause B offers less as compared to clause A. In addition, clause C offers the most restrictive coverage. Therefore, the policyholder may opt for a clause in the marine insurance policy according to the requirement.