Cargo insurance glossary

The words that decide a claim, defined from the instruments they come from rather than paraphrased from other glossaries. Where a term is a clause, the clause is named; where it is a statutory concept, the section is named.

61 termsDefined from sourceNo statistics

Clauses and wordings

What is covered

Value and premium

Claims and recovery

Carriage and documents

Law and duties

Market and parties

A

Actual total loss: The goods are destroyed, gone, or no longer the thing they were.
All risks: Cover written so that everything is insured unless an exclusion applies.
Assignment and blank endorsement: How the right to claim travels with the goods.

B

Bill of lading B/L: Receipt, evidence of the carriage contract, and document of title.
Both to blame collision clause: Covers a liability the bill of lading passes back to the cargo owner.
Broker: An intermediary acting for the insured in placing the risk.

C

Carrier liability: What the carrier owes by treaty — capped, usually by weight, never by value.
Certificate of insurance COI: Evidence that a named shipment is covered under a policy.
Change of voyage: A destination changed after cover attached — notify the insurer promptly.
CIF plus 10%: The customary basis of valuation: cost, insurance, freight and a tenth on top.
Clean receipt Claused receipt · Exception noted: Signing for goods without noting damage weakens the claim against the carrier.
Constructive total loss CTL: Not destroyed, but not worth saving.
CTU Code: The international code of practice for packing containers and trailers.

D

Declaration: Telling the insurer a shipment has moved under the open cover.
Deductible Excess: The first slice of every claim, borne by the insured.
Delay exclusion: Loss caused by delay is excluded, even where an insured peril caused the delay.
Delay in start-up DSU · ALOP: Project cover for the financial consequences of late equipment.
Duty of fair presentation: What you must tell the underwriter before they quote.

F

Financial strength rating: An agency's opinion of an insurer's ability to pay claims.
First notification of loss FNOL: The first report of a loss, which starts every clock that matters.
Franchise: A threshold, not a deduction — once you exceed it, the whole loss is paid.

G

General average GA: A shared bill when something is sacrificed to save the whole venture.
General average bond and guarantee: The security you post to get your cargo released after a GA declaration.

I

Incoterms: The ICC rules that set where risk passes and who, if anyone, must insure.
Indemnity: Putting the insured back where they were — no better.
Inherent vice: Goods failing because of what they are, not because of anything that happened.
Institute Cargo Clauses ICC: The standard market wordings for cargo cover — (A), (B) and (C).
Institute Strikes Clauses (Cargo) CL386: Buys back strikes, riots, civil commotion, terrorism and political motive.
Institute War Clauses (Cargo) CL385: The separate wording that buys back the war exclusion.
Insufficient packing: Excluded where the packing was not fit for the transit that was booked.
Insurable interest: You can only insure goods you stand to lose something by.

L

Limit per conveyance: The most the insurer will pay for everything on one vehicle, aircraft or ship.
Loading: An addition to the rate for an identified extra exposure.
Loss adjuster: Applies the wording to the facts and recommends the settlement.

M

Managing general agent MGA: Underwrites on delegated authority from an insurer.
Marine Insurance Act 1906 MIA 1906: The English statute that still frames most cargo policies worldwide.
Marine warranty surveyor: Independent approval of a heavy-lift or project operation before it happens.
Minimum premium: The floor under any single premium, whatever the rate produces.

N

Named perils: Cover that responds only to a listed cause of loss.

O

Open cover Open policy · Annual policy: A standing contract that covers every shipment you declare under it.

P

Particular average: A partial loss borne by one interest alone.
Policy wording: The document that actually decides the claim.

R

Rate per 100: How cargo premium is quoted: a rate applied to each 100 of insured value.

S

Salvage charges: What salvors are owed for saving property at sea, recoverable under the cover.
Sanctions limitation clause: Cover falls away where paying would breach sanctions law.
Seller's interest cover Contingency insurance: A seller's fallback when the buyer was supposed to insure and did not.
Special Drawing Right SDR: The IMF unit that carriage conventions state their liability limits in.
Subrogation: The insurer stepping into your shoes to recover from whoever caused the loss.
Sue and labour Duty of assured: Your duty to minimise a loss, and the insurer's duty to pay for the effort.
Sum insured Insured value: The agreed figure the cover is written for, and the ceiling on any payment.
Survey and surveyor: Independent inspection that establishes what happened and how much.

T

Temperature-controlled cargo Reefer cargo: Cover for chilled and frozen goods, conditioned on the equipment and the records.
Time bar: The deadline after which the carrier cannot be sued at all.
Transit clause Duration clause · Warehouse to warehouse: The clause that decides when cover starts and stops.

U

UCP 600: The letter-of-credit rules, including what an insurance document must show.
Under-insurance Average · Pro rata condition of average: Declare half the value and a partial loss pays half.
Underwriter: The person or entity that accepts the risk and sets the price.
Unseaworthiness and unfitness: Excluded only where the insured knew about it when the goods were loaded.

W

Warranty (in insurance): A promise in the policy — since 2015, a suspensive one rather than a fatal one.
Wilful misconduct: Deliberate loss by the insured — excluded, and it also breaks the carrier's limit.

Y

York-Antwerp Rules YAR: The private code that decides how general average is adjusted.

InsuranceScanner is an insurance intermediary, not an insurer — see the Terms for our role. Nothing here is a personal recommendation that a particular cover, sum insured or deductible is suitable for you. Where anything on this page conflicts with the certificate, policy schedule or wording issued by an insurer, that document governs.