ICC(B) Terms and Conditions
Interlink編集部ICC(B) means the Institute Cargo Clauses (B), a marine cargo insurance condition that principally covers loss of or damage to cargo resulting from specified risks listed in the clauses.
Unlike ICC(A), which provides broad cover against risks of loss of or damage to cargo subject to the contractual exclusions, ICC(B) requires the cause of the loss to be examined against the specified insured risks.
Accordingly, the mere fact that cargo was broken, wet or short-delivered during transit does not determine coverage under ICC(B). It is necessary to establish whether the loss is connected with a listed peril such as fire, stranding, overturning of a land conveyance, earthquake, entry of sea water, jettison or washing overboard.
Unless otherwise stated, this article primarily addresses ICC(B) 1/1/09. Actual policies may include special clauses, additional risks, additional exclusions, deductibles and commodity-specific terms. The actual policy and incorporated clauses therefore need to be reviewed in an individual case.
Scope of This Article
| Item | What This Article Covers | What Other Articles Cover |
|---|---|---|
| Basic structure of ICC(B) | The listed-perils structure and the sequence of coverage analysis | Marine Cargo Insurance examines the overall structure of cargo insurance |
| Differences from ICC(A) and ICC(C) | Differences in coverage scope and causation analysis | ICC(A) and ICC(C) examine each condition in detail |
| Entry of water | Entry of sea, lake or river water and the distinction from rain or condensation | Wet Damage examines investigation of wet cargo losses in detail |
| Jettison and washing overboard | Their position as specified marine risks under ICC(B) | General Average examines jettison and general average sacrifice in detail |
| Loading and unloading losses | Total loss of an individual package lost overboard or dropped during specified loading or unloading operations | Carrier liability for handling accidents is addressed in relevant casualty articles |
| Insufficient packing and inherent vice | Why exclusions can remain relevant even where a listed peril has occurred | Insufficient Packing and Inherent Vice examine those exclusions in detail |
| Duration | The Transit Clause and basic Warehouse-to-Warehouse principles | Insurance Period and Transit Route examine attachment and termination in detail |
| Claims handling | Listed perils, causation, evidence, mitigation and preservation of third-party rights | Specific carrier liability and subrogation issues are addressed in related claims articles |
Purpose and Basic Structure of ICC(B)
ICC(B) is a principal cargo insurance condition for situations where broader protection than ICC(C) is desired but the broad scope of ICC(A) is not required.
Its defining feature is that the insured risks are specified. The occurrence of damage during the insurance period is not sufficient by itself. It is necessary to consider whether the loss of or damage to the cargo is reasonably attributable to, or caused by, one of the risks identified in Clause 1.
The practical analysis therefore does not begin with a conclusion such as “breakage is covered” or “wet damage is covered.” It begins by identifying what actually happened and then testing that cause against the listed risks.
Even where a listed risk is established, payment is not automatic. General exclusions, insufficient packing, inherent vice, delay, unfitness of a vessel or container, war risks, strikes risks, duration, insurable interest and other policy requirements may remain relevant.
Principal Risks Listed under ICC(B)
| Category | Listed Risk | Typical Practical Situation | Main Issue to Confirm |
|---|---|---|---|
| Major casualty | Fire or explosion | Fire on a vessel, in a warehouse or involving a conveyance | Relationship between the fire or explosion and the cargo damage |
| Vessel casualty | Vessel or craft being stranded, grounded, sunk or capsized | Breakage or wet damage following a vessel casualty | Timing, stowage position and causation |
| Land transport casualty | Overturning or derailment of land conveyance | Truck overturning or rail derailment | Relationship between the conveyance casualty and cargo damage |
| Collision or contact | Collision or contact of vessel, craft or conveyance with an external object other than water | Contact with another vessel, quay or structure | Object contacted, circumstances and effect on cargo |
| Distress | Discharge of cargo at a port of distress | Emergency discharge from a casualty vessel | Reason for discharge and resulting cargo damage |
| Natural event | Earthquake, volcanic eruption or lightning | Cargo collapse after an earthquake or damage caused by lightning | Causation and whether the loss occurred during the insurance period |
| General average | General average sacrifice | Cargo deliberately sacrificed for the common safety | General average declaration and nature of the sacrifice |
| Marine risk | Jettison or washing overboard | Cargo intentionally jettisoned or swept overboard by waves | Stowage position, casualty report and on-deck terms |
| Water entry | Entry of sea, lake or river water into vessel, craft, hold, conveyance, container or place of storage | Sea water entering a damaged container or water entering a cargo hold | Type of water, route of entry, place entered and causation |
| Loading or unloading | Total loss of any package lost overboard or dropped while loading onto or unloading from a vessel or craft | An individual package falling into the sea or being dropped and becoming a total loss | Stage of handling, package unit and whether the package is a total loss |
Clause 1 uses different wording for different groups of risks. Certain losses must be reasonably attributable to the listed event, while others are expressed as losses caused by the specified peril. In practice, the existence of the casualty alone is insufficient: documentary evidence should establish the relationship between the listed peril and the actual cargo damage.
Differences Between ICC(A), ICC(B) and ICC(C)
| Condition | Basic Coverage Structure | Typical Losses More Readily Considered | Losses More Likely to Fall Outside the Standard Cover | Main Analytical Focus |
|---|---|---|---|---|
| ICC(A) | Broad risks cover subject to exclusions | Breakage, wet damage, theft, non-delivery, shortage, contamination and handling damage | Insufficient packing, inherent vice, ordinary wear, delay, war and strikes risks | Existence of loss, fortuity and exclusions |
| ICC(B) | Specified risks listed in the clauses | Fire, stranding, overturning, earthquake, entry of specified water and washing overboard | Ordinary breakage, theft, rain damage, unexplained shortage and partial handling damage | Listed peril and causation |
| ICC(C) | A narrower group of specified risks | Fire, stranding, sinking, collision, overturning, general average sacrifice and jettison | Earthquake, washing overboard, entry of sea water and package total loss during specified loading or unloading | Whether the loss falls within the narrower list of insured risks |
ICC(B) should not be understood merely as a condition positioned halfway between A and C. Earthquake, volcanic eruption, lightning, washing overboard, entry of sea, lake or river water and the specified package-total-loss provision during loading or unloading are particularly important distinctions from ICC(C).
Requirements for Analysing a Loss under ICC(B)
| Item | What to Confirm | Why It Matters | Main Documents |
|---|---|---|---|
| Applicable wording | Version of ICC(B), additional risks, special clauses and additional exclusions | Two policies described as ICC(B) may contain different contractual terms | Policy, Certificate, Declaration and incorporated clauses |
| Insured cargo | Whether the damaged cargo is within the subject matter insured | The listed-peril analysis is irrelevant if the goods are outside the insured subject matter | Invoice, Packing List and insurance declaration |
| Insurable interest | Whether the claimant had an insurable interest at the time of loss | This is a fundamental requirement for recovery | Sales contract, Incoterms, Invoice and policy documents |
| Duration | Whether the casualty occurred during the insured transit | A listed peril occurring outside the policy period raises a separate issue | Pickup, terminal, B/L, release and delivery records |
| Listed peril | Whether the cause falls within Clause 1 of ICC(B) | This is the central coverage question under ICC(B) | Incident report, voyage records, photographs and survey evidence |
| Causation | Whether the listed peril is connected with the actual cargo loss | A vessel casualty does not automatically make every cargo condition an insured loss | Stowage position, photographs, timeline and Survey Report |
| Exclusions | Whether packing, inherent vice, delay or another exclusion applies | A listed peril does not override the contractual exclusions | Packing specifications, commodity information and temperature records |
Entry of Sea, Lake or River Water — Wet Damage Is Not Automatically Covered
One of the most significant features of ICC(B) is cover for loss or damage caused by the entry of sea, lake or river water into a vessel, craft, hold, conveyance, container or place of storage.
For example, sea water entering through damage to a container shell or water entering a vessel's cargo hold may fall for consideration under this listed peril.
The clause should not, however, be understood as covering every incident involving water. Rain damage, condensation, container sweat and humidity require a different causation analysis and should not automatically be treated as entry of sea, lake or river water.
The place into which the water entered is also material. The investigation should consider the route of entry into a container, hold, conveyance or place of storage, together with shell damage, door condition, damage pattern, salt testing, weather and storage circumstances.
A fresh-water test result does not automatically establish exclusion, and the presence of salt does not automatically establish that every item of damage is covered. Such findings are evidence used as part of the overall causation analysis.
Jettison, Washing Overboard and General Average
ICC(B) lists general average sacrifice, jettison and washing overboard as insured risks.
Jettison generally concerns the intentional disposal of cargo for the common safety of the vessel and cargo interests and may form part of a general average event. Washing overboard concerns cargo swept overboard by waves.
Washing overboard can be particularly relevant to on-deck cargo. However, the fact that cargo was carried on deck does not itself guarantee cover. The B/L wording, authorisation for deck carriage, special insurance conditions, stowage arrangement and any applicable exclusions should also be reviewed.
Where general average is declared, physical cargo damage, general average contribution, general average sacrifice and salvage charges should be distinguished from one another.
Packages Lost Overboard or Dropped During Loading or Unloading
ICC(B) 1/1/09 specifically lists the total loss of an individual package that is lost overboard or dropped while being loaded onto or unloaded from a vessel or craft.
This provision is sometimes summarised in practice as cover for the total loss of a package through immersion or dropping during loading or unloading. The important point is that it is not a general provision covering every handling accident.
If one wooden case falls into the sea from a crane and the entire case becomes a total loss, the provision may be relevant. If the case is dropped but the machinery inside can be repaired, leaving only a partial loss, this provision alone does not automatically establish cover.
The handling stage, relationship to loading onto or unloading from the vessel or craft, package unit, extent of damage and possibility of repair should therefore be confirmed.
Principal Exclusions under ICC(B)
| Exclusion Issue | Main Point | Significance under ICC(B) | Practical Evidence |
|---|---|---|---|
| Wilful misconduct | Loss attributable to wilful misconduct of the Assured | It is not treated as an ordinary fortuitous insured casualty | Incident history, instructions and witness evidence |
| Ordinary loss | Ordinary leakage, ordinary loss in weight or volume and ordinary wear and tear | Normal transit deterioration remains separate from listed perils | Normal loss rates, shipment quantities and commodity characteristics |
| Insufficient packing | Packing or preparation insufficient for the ordinary incidents of transit | It may remain relevant even where a listed peril has occurred | Packer, timing, packing specifications and container stowage |
| Inherent vice | Deterioration arising from the nature of the cargo itself | Damage caused by the commodity itself must be distinguished from external listed risks | Commodity specifications, quality and temperature or humidity data |
| Delay | Loss or damage caused by delay | The exclusion may apply even where delay follows an insured risk | Separate physical damage from lost profit or loss of market |
| Certain insolvency or financial default | Financial default of vessel interests and the Assured's relevant knowledge | The specific contractual knowledge requirements should be checked | Information available at contracting and loading |
| Deliberate damage by third parties | Deliberate damage or destruction by the wrongful act of any person | This is an important exclusion under standard ICC(B) | Check whether Malicious Damage or equivalent additional cover applies |
| Vessel or container unfitness | Certain unseaworthiness or unfitness for safe carriage | Knowledge, identity of the person loading and timing can be material | Container condition, loading records and prior knowledge |
| War risks | War, civil war, capture, detention and derelict weapons of war | Separate war-risk cover should be reviewed | War Clauses, route and policy |
| Strikes and related risks | Strikes, riots, civil commotion and terrorism | These are excluded from ordinary ICC(B) | Review Strikes Clauses and other endorsements |
A Listed Peril Does Not Make Every Loss Recoverable
Under ICC(B), the existence of a listed peril and the existence of cargo damage are separate factual questions.
If a vessel strands, a quality defect that existed before the stranding does not become stranding damage merely because the goods were on board the casualty vessel. Similarly, rust found after an earthquake must be examined to determine whether the earthquake caused the damage or whether it resulted from pre-existing moisture exposure.
A vessel fire also does not mean that every item on board has necessarily sustained physical damage. Heat, smoke, soot and extinguishing water should be examined to establish their actual effect on the particular cargo.
This causation analysis is one of the most important practical distinctions between ICC(B) and the broader structure of ICC(A).
Situations in Which ICC(B) May Be Considered
| Cargo or Transit Situation | Main Risk Concern | Reason ICC(B) May Be Considered | Additional Issue to Check |
|---|---|---|---|
| Raw materials or relatively damage-resistant cargo | Fire, stranding and collision | Major transit casualties are more significant than ordinary minor breakage | Whether theft or shortage protection is required |
| Cargo vulnerable to wet damage | Entry of sea, lake or river water | ICC(B) includes a water-entry peril not available to the same extent under ICC(C) | If rain or condensation risk is material, the cover may be insufficient |
| Transit exposed to earthquake risk | Earthquake | Earthquake is an important ICC(B) risk not listed under ICC(C) | Confirm that the loss occurs during insured transit |
| On-deck cargo | Washing overboard and jettison | Washing overboard is expressly included as a listed risk | Check deck-carriage terms and additional exclusions |
| Cargo exposed to vessel loading or unloading risk | Package lost overboard or dropped | ICC(B) includes the specified package-total-loss provision | If partial handling damage is important, consider broader cover |
| Balancing premium and scope of cover | Major casualty plus selected additional risks | ICC(B) may provide broader protection than ICC(C) without adopting ICC(A) | Confirm that the principal cargo risks actually match the listed perils |
ICC(B) Coverage Analysis Flow
- Identify the applicable insurance contract.
Confirm the ICC(B) version, policy, special clauses, additional risks, exclusions and any War or Strikes cover. - Identify the insured cargo and insurable interest.
Confirm that the cargo is insured and that the claimant had an insurable interest at the time of loss. - Establish when and where the casualty occurred.
Arrange pickup, terminal receipt, vessel loading, discharge, release, warehousing and delivery chronologically and confirm whether the loss occurred during insured transit. - Establish the actual cargo damage.
Use pre- and post-transit condition, quantity, quality, external condition, photographs and delivery remarks to establish the loss. - Identify the cause.
Determine whether fire, stranding, earthquake, water entry, jettison, washing overboard, dropping during loading or another event occurred. - Match the cause to an ICC(B) listed peril.
Identify the particular Clause 1 peril. If no listed peril applies, recovery under standard ICC(B) may be difficult. - Establish causation between the peril and the cargo loss.
The occurrence of a major casualty is not sufficient unless it is connected with the actual damage claimed. - Review exclusions and additional terms.
Consider packing, inherent vice, delay, vessel or container unfitness, war, strikes and other policy provisions. - Mitigate the loss and preserve third-party rights.
Prevent further deterioration and preserve claims against the shipping line, freight forwarder, warehouse, inland carrier and other parties. - Submit the evidence to the insurer or insurance intermediary.
Organise the listed peril, causation, exclusions and quantum so that the coverage determination can be made.
Steps five to seven are particularly important under ICC(B). The analysis should not move directly from “cargo damage exists” to “an insured loss exists.” It should ask what happened, which listed peril applies and whether that peril caused the particular loss.
Cases That Frequently Cause Practical Problems
| Case | Main Cause or Issue | Evidence to Review | Decision Point | Initial Action |
|---|---|---|---|---|
| Wet damage caused by sea water entering a container | Entry of sea water versus rain or condensation | Container photographs, salt testing, damage pattern and shipping line report | Identify the type and route of water entry | Record the cargo and container together before repair or disposal |
| Cargo damage after vessel stranding | Causation between stranding and the particular damage | Vessel casualty report, stowage position, photographs and Survey Report | Establish the actual effect of the stranding on the cargo | Build a chronological record of casualty and discovery of damage |
| Wooden case dropped during unloading | Total loss of an individual package versus partial damage | Handling records, photographs, repair estimate and package details | Confirm vessel unloading stage and whether the package is a total loss | Preserve the goods and consider survey before repair |
| Rust following handling in rain | Rain, entry of sea water, condensation or inherent characteristics | Weather records, salt testing, anti-rust packing and photographs | Determine whether a listed peril applies rather than relying on the fact of wet damage | Record the moisture route and damage pattern |
| Unexplained shortage on arrival | Theft, non-delivery or incorrect shipment quantity | B/L, Packing List, seal, Devanning Report and delivery documents | Unexplained shortage itself is not an ICC(B) listed peril | Trace the point at which the quantity discrepancy arose |
| Warehouse cargo damaged after an earthquake | Earthquake-induced collapse versus poor storage | Earthquake data, warehouse report, insurance duration and photographs | Confirm causation and whether the goods were still within insured transit | Record racks and cargo immediately after the event |
| On-deck cargo washed overboard | Washing overboard versus other stowage issues | B/L, deck-carriage approval, weather records and vessel report | Confirm the listed peril and applicable special terms | Obtain voyage and stowage records promptly |
| Smoke or soot contamination after vessel fire | Causation between fire and loss of cargo value | Fire report, photographs, inspection report and product evaluation | Distinguish the listed fire peril from the actual physical damage claimed | Inspect or survey before disposal |
Application Scenario 1 — Sea Water Entering a Container
Scenario: Metal components with an invoice value of JPY 15 million are insured under ICC(B). During devanning after import, several wooden cases are found wet and the components inside are rusted. A small hole is found in the side of the container and salt is detected in the affected area.
The analysis first confirms that physical cargo damage occurred during a period potentially falling within the insured transit. The next question is the listed peril. ICC(B) includes entry of sea, lake or river water into a container or other specified location.
The container hole, salt findings, damage distribution and container condition at relevant stages of transit should therefore be examined to determine whether sea water entered the container.
However, rust may also result from longer-term humidity or a pre-shipment condition. The existence of salt does not automatically establish that every item of rust damage is recoverable. The listed peril, actual damage and causal relationship must be analysed separately.
Application Scenario 2 — Dropping During Unloading with Partial Damage
Scenario: Three cases of machinery with a total invoice value of JPY 6 million are insured under ICC(B). During unloading from the vessel, one case falls from a crane onto the quay. The machinery is damaged but can be restored at a repair cost of JPY 1.5 million.
The fact that the accident occurred during unloading and involved a dropped package does not by itself satisfy the specific ICC(B) provision. That provision concerns the total loss of an individual package lost overboard or dropped while being loaded onto or unloaded from a vessel or craft.
In this case, one package was dropped, but the machinery remains repairable and the package is not a total loss. The specific listed peril therefore does not automatically establish coverage for the partial damage.
The entire policy should be reviewed to determine whether another listed peril or additional clause applies. The analysis could be different under ICC(A), which illustrates why the need for partial handling-damage protection should be considered when selecting the insurance condition.
Application Scenario 3 — Earthquake Damage During Intermediate Warehousing
Scenario: Imported cargo with an invoice value of JPY 9 million is temporarily stored in a warehouse while proceeding from the port of discharge to the final destination. A major earthquake causes the cargo to fall from warehouse racks and become damaged.
Earthquake is expressly listed under ICC(B). The first substantive issue is therefore whether the earthquake caused the collapse and resulting cargo damage.
The second major issue is duration. Even though earthquake is an insured listed peril, it remains necessary to determine whether the warehouse stay formed part of the ordinary course of transit or whether the cargo had been placed into storage for a separate purpose that terminated the insurance under the Transit Clause.
The proper analysis therefore does not stop at “earthquake equals cover.” It considers the listed peril, causation, duration, purpose of warehousing and contractual exclusions before reaching a conclusion.
Common Misunderstandings
| Misunderstanding | Actual Practice | Practical Caution |
|---|---|---|
| ICC(B) is fairly broad, so ordinary breakage is generally covered | ICC(B) is a listed-perils form and differs fundamentally from the broader ICC(A) structure. | Identify the cause of breakage and match it to a listed peril. |
| All wet damage is covered under ICC(B) | The entry of sea, lake or river water into specified locations is the relevant listed peril. | Distinguish rain, condensation and container sweat. |
| If the vessel strands, every damaged cargo item on the vessel is covered | The relationship between the stranding and each claimed cargo loss must still be established. | Review stowage position, casualty circumstances and damage pattern. |
| Anything dropped during unloading is covered even if only partly damaged | The particular Clause 1 provision concerns total loss of an individual package. | Distinguish a total loss from repairable partial damage. |
| Any cargo damage at a location affected by an earthquake is covered | Causation and insured duration must still be established. | Review the purpose of warehousing and continuity of transit. |
| Deliberate destruction by a third party is automatically covered under ICC(B) | Deliberate damage or destruction by the wrongful act of another person is an exclusion issue under standard ICC(B). | Check Malicious Damage or equivalent additional cover. |
| ICC(B) is broader than ICC(C), so it is sufficient for ordinary cargo | It may still leave theft, ordinary breakage, unexplained shortage and similar risks outside the standard cover. | Select the condition by the principal cargo risks rather than premium alone. |
| Once a listed peril is established, there is no need to check exclusions | Packing, inherent vice, delay and other exclusions remain relevant. | Analyse insured peril and exclusions as separate stages. |
Comparison of Freight Forwarder Involvement
| Stage | What the Freight Forwarder Can Assist With | What the Freight Forwarder Should Not Determine | Main Party to Consult | Practical Action |
|---|---|---|---|---|
| Selection of condition | Organising cargo details, route and the shipper's principal risk concerns | Guaranteeing that a future casualty will be paid under ICC(B) | Insurer or insurance intermediary | Explain the differences between ICC(A), ICC(B) and ICC(C) |
| Wet damage | Collecting container condition, photographs and salt-test evidence | Stating that every wet-damage case is covered under ICC(B) | Insurer, insurance intermediary or surveyor | Organise the type and route of water entry |
| Handling casualty | Organising handling stage, dropping circumstances, package unit and extent of damage | Stating that partial damage caused by dropping is automatically covered | Insurer or insurance intermediary | Check the individual-package total-loss requirement |
| Major casualty | Obtaining casualty and voyage information from the shipping line and other parties | Assuming that every cargo loss is insured merely because a major casualty occurred | Insurer, insurance intermediary or surveyor | Establish causation between the listed peril and the cargo loss |
| Claim against carriers | Organising notices, documents and the relevant stage of transport | Automatically determining liability of the Contracting Carrier or Actual Carrier | Carrier, insurer or maritime lawyer where appropriate | Preserve contractual notices and applicable time limits |
| Insurance claim | Helping organise factual evidence and casualty chronology | Promising the final insurance decision or claim amount on behalf of the insurer | Insurer or insurance intermediary | Separate facts, insurance coverage and carrier liability |
Decision Checklist for Cargo Claims
| Stage of Review | Party to Confirm With | What to Confirm | Action If There Is a Problem |
|---|---|---|---|
| Discovery of damage | Cargo owner, warehouse and delivery company | Cargo condition, outer packing, quantity, discovery time and delivery remarks | Record conditions before and after unpacking and place appropriate remarks on delivery documents |
| Listed-peril review | Shipping line, warehouse, delivery company and terminal interests | Evidence of fire, stranding, overturning, earthquake, water entry or other casualty | Obtain casualty reports, voyage information and site records |
| Wet-damage review | Cargo owner, warehouse and surveyor | Type of water, route of entry, damage pattern and container condition | Obtain salt testing, weather data and additional container photographs |
| Loading or unloading casualty | Terminal operator, shipping line and warehouse | Handling stage, lost-overboard or dropped event, package unit and total or partial loss | Preserve handling records and the damaged cargo and consider survey |
| Duration review | Freight forwarder, warehouse and insurer | Pickup, terminal receipt, discharge, release, storage and final delivery chronology | Determine whether any storage outside the ordinary course of transit occurred |
| Exclusion review | Cargo owner, packing contractor, manufacturer and insurer | Packing, inherent vice, delay and other exclusions | Document both the listed peril and any competing exclusion cause |
| Preservation of third-party rights | Contracting Carrier, Actual Carrier, warehouse and other parties | Notice requirements, claim periods, responsibility stage and necessary evidence | Preserve claims within the applicable time limits while the insurance claim proceeds |
| Before disposal or repair | Insurer, insurance intermediary and surveyor | Survey, salvage value and need for physical inspection | Confirm requirements before evidence is destroyed or altered |
Loss Mitigation and Preservation of Rights Against Third Parties
When a casualty potentially covered under ICC(B) occurs, the Assured should not simply wait for the insurance claim to be processed. Reasonable measures should be taken to avert or minimise further loss.
This may include protecting wet cargo from further corrosion, moving cargo affected by fire to a safe location, and separating salvageable cargo from goods that are beyond recovery. At the same time, disposal, repair or sale of the goods may destroy important evidence, so any necessary survey or insurer confirmation should be considered first.
Rights against carriers, bailees and other third parties should also be properly preserved and exercised. Where the shipping line, Contracting Carrier, Actual Carrier, freight forwarder, warehouse or inland carrier may be responsible, delivery remarks, casualty notices, claim notices, photographs and survey evidence should be retained.
After indemnifying the cargo owner, the marine cargo insurer may pursue recovery from a responsible party by subrogation. Preserving third-party rights at the initial stage is therefore an important part of the cargo claim process.
When to Involve an Insurer, Insurance Intermediary or Maritime Lawyer
A general explanation of ICC(B) should be distinguished from a final contractual determination in a specific claim. Escalation to an insurer, insurance intermediary, surveyor or, where appropriate, a maritime lawyer should be considered in situations such as the following:
- a high-value loss where the listed peril or causal relationship is disputed;
- a dispute over whether wet damage resulted from sea water entry, rain or condensation;
- a case in which both insufficient packing and a listed peril may have contributed to the damage;
- a dispute over whether a loading or unloading casualty resulted in total loss of an individual package;
- a dispute over whether intermediate warehousing remained within the ordinary course of transit;
- a major vessel fire, stranding or general average event;
- an approaching claim or litigation time limit against a carrier; or
- a dispute requiring interpretation of ICC(B) under English law and practice.
Practical Points
The basic discipline under ICC(B) is to identify the cause before focusing on the description of the damage. Breakage, wet damage or shortage alone does not determine coverage.
A practical sequence is to confirm: the applicable policy and clauses; insured duration; actual cargo loss; cause of the casualty; the relevant ICC(B) listed peril; causation between that peril and the claimed damage; applicable exclusions; and preservation of rights against responsible third parties.
At the insurance-arrangement stage, it is also insufficient simply to explain that ICC(B) is broader than ICC(C). If the cargo owner is particularly concerned about ordinary breakage, theft, non-delivery, unexplained shortage, rain damage or partial handling damage, standard ICC(B) may not provide the expected protection.
Summary
ICC(B) is a marine cargo insurance condition that principally covers loss of or damage to cargo resulting from specified risks listed in the clauses. It is narrower than ICC(A), but includes important risks not found within the narrower ICC(C) structure, including earthquake, volcanic eruption, lightning, washing overboard, entry of sea, lake or river water and the specified package-total-loss provision during loading or unloading.
The central question under ICC(B) is not merely whether cargo was damaged, but what caused the damage, whether that cause is a listed peril and whether the listed peril caused the particular loss claimed.
Even when a listed peril applies, insufficient packing, inherent vice, delay, vessel or container unfitness, war and strikes risks, duration, insurable interest and other policy provisions must still be reviewed.
Following a casualty, evidence should be preserved, further loss should be mitigated and rights against carriers and other third parties should be protected. Selection of coverage, additional-risk requirements and interpretation of individual claims should be confirmed with an experienced insurer or insurance intermediary.
