Transit clause
The clause that decides when cover starts and stops.
Definition
Clause 8 of the Institute Cargo Clauses. Cover attaches when the goods are first moved in the warehouse at the place named in the contract for the purpose of loading for the transit, continues through the ordinary course of that transit, and terminates at the first of several events: delivery to the final warehouse, delivery to any other warehouse the insured elects to use for storage outside the ordinary course of transit or for allocation or distribution, the election to use a conveyance for storage outside the ordinary course, or the expiry of 60 days after discharge from the vessel.
Why it decides money
Most "the policy was in force, wasn't it?" arguments are duration arguments. Cargo sitting in a distribution centre being picked is no longer in transit, and the 60-day clock after discharge runs whether or not anybody is watching it.
Related terms
- Change of voyage
- A destination changed after cover attached — notify the insurer promptly.
- Institute Cargo Clauses
- The standard market wordings for cargo cover — (A), (B) and (C).
More in clauses and wordings
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