On Deck Risks in Container Ship Transportation
Interlink編集部What Are On Deck Risks in Container Ship Transport?
On Deck risks in container ship transport refer to risks arising when containers are loaded on the deck instead of inside the hold. Such risks include rough weather, waves, seawater intrusion, container loss overboard, improper stowage, inadequate lashing, container damage, and reefer power failure.
Modern container ships carry cargo in containers not only inside the hold but also on the deck. Therefore, containers on the deck of container ships should not be treated in the same way as breakbulk cargo loaded on the deck of conventional ships; rather, they must be organized based on the normal practices of container ship transport.
However, the fact that on-deck loading is a standard operating method, the payment of insurance claims after an accident, the carrier’s liability, and the freight forwarder’s liability are each separate issues.
After an incident, it is essential to separately verify the actual stowage location, B/L terms and conditions, booking conditions, cargo insurance terms, cause of the incident, onboard stowage, deck lashing, cargo securing inside the container, extent of rough weather, and whether general average applies.
Scope Covered in This Article
| Item | Contents Covered in This Article | Contents Covered in Other Articles |
|---|---|---|
| On-deck Loading of Container Ships | Basic risks involved when containers are loaded on deck at the shipping line’s discretion are organized here. | Details of container ship structure, stowage plans, and vessel navigation are covered in the articles on Container Ships and Stowage on Board. |
| Underdeck or On-deck Clause | Methods to verify marine cargo insurance coverage when containerized cargo is stowed on deck or under deck are addressed. | Details of individual special clauses are covered in the Underdeck or On-deck Clause and On Deck Cargo Clause articles. |
| ICC(A), ICC(B), ICC(C) | Differences between all-risk coverage and named-perils coverage for on-deck incidents are clarified. | The full provisions and exclusion structures of each ICC version are treated in the ICC 2009 Clauses Explanation article. |
| Storm Damage and Container Loss | Differentiation among washing overboard, jettison, accidental loss, and general average sacrifice damage is provided. | Handling of major marine casualty incidents is covered in Container Loss, Storm Damage, and General Average articles. |
| Insufficient Lashing | Distinctions are made between shipboard lashing and cargo securing inside containers, with an overview of insurance exclusions and carrier liability. | Cargo packaging specifications and vanning methods are discussed in Packaging Defects and Insurance Exclusions. |
| Forced Discharge | Insurance continuation and notification requirements when cargo is discharged, transshipped, or transloaded at unscheduled ports are addressed. | Details of the entire insurance period are covered in Forced Discharge, Marine Cargo Insurance, and Warehouse to Warehouse articles. |
| Freight Forwarder’s Scope of Involvement | Using the Standard Five Classifications, the scope of communicating stowage conditions, accident notifications, document requests, and claims cooperation is organized. | The general contractual liabilities of freight forwarders are treated in Freight Forwarder Liability and NVOCC Liability articles. |
| Reefer and Specialized Containers | Checks on power supply, temperature control, preservation, securing, and special conditions related to on-deck loading are covered. | Cargo-specific temperature management is covered in Marine Cargo Insurance for Refrigerated and Frozen Cargo. |
This article mainly explains based on the Institute Cargo Clauses 2009. If the actual insurance contract applies the 1982 edition, proprietary clauses, special clauses, or specific warranties, those wordings incorporated in the insurance policy should be prioritized for confirmation.
Differences between On-Deck Stowage on Conventional Ships and Container Ships
When machinery, steel, plant equipment, or other cargo is stowed uncovered on the deck of a conventional ship, the cargo itself is directly exposed to rain, waves, seawater, wind pressure, and ship motions.
In contrast, on container ships, cargo is principally stored inside containers, which are then stowed either in the hold or on deck as container units. Although the container acts as a barrier between the cargo and the external environment, risks such as container loss overboard, container collapse, seawater ingress through doors, and breakage of shipboard lashing still remain.
| Category | Main Risks | Marine Cargo Insurance Considerations | B/L & Booking Considerations | Key Documents for Incident Investigation |
|---|---|---|---|---|
| Uncovered Cargo on Conventional Ships | Direct exposure of cargo to seawater, rain, waves, and wind pressure | On Deck Cargo Clause, deck stowage conditions, and acceptance restrictions | On Deck notation, shipper’s consent, and stowage conditions | Stowage photos, securing diagrams, protective measures records, and B/L |
| Dry Containers | Container loss, collapse, deformation, and seawater ingress | Underdeck or On-deck Clause, ICC clauses, and exclusions | Shipping line’s authorization for deck stowage and presence of special instructions | Stowage diagrams, container photos, EIR, and survey report |
| Flat Rack Containers | Cargo exposure, securing breakage, load shift, and wave damage | Special cargo clauses, packing, and securing conditions | Dimensions, weight, overgauge status, and shipping line approval | Securing calculations, stowage photos, booking records, and inspection reports |
| Open Top Containers | Rainwater ingress from above, wave damage, and poor waterproofing | Coverage for water damage, inadequate packing, and special conditions | Possibility of deck stowage and waterproofing requirements | Status of tarpaulin/sheet, seals, stowage position, and salt test results |
| Reefer Containers | Power failure, incorrect settings, delayed alarm response | Coverage for temperature fluctuations, mechanical breakdown conditions, and exclusions | Set temperature, ventilation conditions, and power management instructions | Reefer logs, temperature charts, and data logger records |
Since deck stowage is a common operational practice on container ships, the mere fact that cargo is stowed on deck does not automatically constitute a breach of contract or imply negligence on the part of the carrier.
Conversely, just because it is normal operational practice does not exempt from liability for poor stowage, inadequate lashing, container unsuitability, or failure to follow special stowage instructions.
Relationship with Underdeck or On-deck Clause
In container ship transport, the shipping line determines the stowage position of each container by considering the vessel’s stability, weight distribution, hazardous cargo segregation, port call order, and positions of reefer plugs.
The Underdeck or On-deck Clause is sometimes used to define the insurance treatment of cargo packed in sealed containers when stowed either on deck or in the hold as part of regular container ship transport.
However, the coverage scope cannot be judged solely by the name "Underdeck or On-deck Clause." It is necessary to confirm the wording used by each insurer, the applicable containers, exclusions for special cargo, applicability to flat rack or open top containers, and handling of on-deck bills of lading.
| Item to Confirm | Details to Check | Common Misjudgments | Practical Response |
|---|---|---|---|
| Applicable Containers | Whether only sealed dry containers, or also reefers and special containers are included | Assuming all container types are covered just because they are called containers | Cross-check the container type used with the wording of any special clauses. |
| Method of On-deck Stowage | Whether stowed as part of standard container ship transport | Confusing on-deck stowage of unpacked cargo or special cargo with container stowage | Verify booking details, B/L, and shipping line approval. |
| Cargo Condition | Whether the cargo was properly packed, stowed, and secured inside the container | Confusing lashings on deck with cargo securing inside the container | Check vanning photos, securing records, and packing specifications. |
| Insurance Terms | ICC(A), ICC(B), ICC(C), special clauses, and warranties | Assuming all damages are covered by the Underdeck or On-deck Clause alone | Confirm the base clauses together with any additional special clauses. |
| Cause of Incident | Rough weather, washing off, cargo shifting, seawater intrusion, insufficient lashing, or temperature incidents | Determining the cause based solely on the fact of on-deck stowage | Analyze causality from survey results and vessel documentation. |
ICC(A), ICC(B), ICC(C) and On Deck Incidents
For container incidents on deck, simply recognizing the differences between ICC(A), ICC(B), and ICC(C) as mere policy names is insufficient.
ICC(A) offers comprehensive coverage broadly protecting against accidental external damage, except for losses excluded by the clauses. In contrast, ICC(B) and ICC(C) provide named perils coverage requiring the loss to fall under the risks listed in Clause 1.
| Insurance Conditions | Basic Structure | Relation to On Deck Incidents | Particular Risks to Confirm | Precautions |
|---|---|---|---|---|
| ICC(A) | Comprehensive coverage excluding exemptions from Clause 4 to Clause 7 | May cover accidental container loss, collapse, impact, seawater ingress, etc. | Accident’s accidental and external nature, exempted causes, causal relation to damage | All Risks does not mean unconditional coverage for all causes and all damages. |
| ICC(B) | Named perils coverage defined in Clause 1 | Risks such as washing overboard, jettison, seawater ingress into container are enumerated | Washing Overboard, Jettison, Entry of Sea Water, etc. | Not only rough weather but also causal link between named peril and cargo damage must be confirmed. |
| ICC(C) | Named perils coverage more limited than ICC(B) | General average sacrifice and jettison are included, but washing overboard and seawater ingress do not cover the same scope as ICC(B) | General Average Sacrifice, Jettison, Stranding, Sinking, Collision, etc. | It is important not to regard accidental container loss as intentionally performed jettison by the master. |
| Common Clause 2 of ICC | Coverage relating to general average and salvage charges | Checked when general average contribution or salvage charges are at issue | General average declaration, General Average Bond, General Average Guarantee | Structurally separate from Clause 1, which covers physical damage to cargo itself. |
For example, if a container is accidentally lost overboard due to rough weather, under ICC(B) it is important to determine whether it qualifies as washing overboard. Under ICC(C), accidental washing overboard cannot be treated as equivalent to intentional jettison performed by the master for common safety.
Also, when general average is declared, the physical damage to the cargo, general average sacrifice damage, and general average contribution are each confirmed as separate items.
Differences Between Heavy Weather, Container Loss Overboard, Jettison, and General Average
Even when containers on deck are lost at sea, the cause and legal nature are not uniform.
| Event | Nature of Accident | Main Issues in Cargo Insurance | Main Issues in General Average | Reference Documents |
|---|---|---|---|---|
| Accidental Container Loss Overboard | Loss caused unintentionally due to heavy weather, ship motion, or lashing failure | ICC terms, washing overboard, fortuitous accident, and exclusions | Not necessarily considered a General Average sacrifice loss by itself. | Vessel accident report, stowage plan, lashing records, and weather records |
| Jettison | Deliberate disposal of cargo into the sea for the safety of the ship and common maritime adventure | Jettison under ICC(B) and ICC(C), coverage scope under ICC(A) | Whether requirements of Rule A and Rule I are met | Master’s report, logbook, General Average notice, and accident report |
| General Average Sacrifice Loss | Damage caused intentionally and reasonably as a sacrifice for the common safety | General Average Sacrifice under Clause 1 | Whether recognized as a sacrifice loss in General Average | General Average adjuster’s documents, Master’s report, and damage assessment |
| General Average Contribution | Cost sharing of General Average expenses by interested parties including ship, cargo, and freight | Verify coverage under ICC Clause 2. | Obligation to contribute may arise even without physical damage to cargo. | General Average Bond, General Average Guarantee, and contribution valuation documents |
| Salvage Charges | Payment to those who rescue vessels and cargo in danger | Clause 2, salvage charges coverage, and insurer notification | Whether included in General Average depends on applicable rules and circumstances. | Salvage contract, coverage claim documents, insurer notification, and adjustment documents |
Under Rule A of the York-Antwerp Rules, for a General Average act to be valid, an extraordinary sacrifice or expenditure must be intentionally and reasonably made to preserve property from a common maritime peril.
Therefore, if lashing breaks during heavy weather and containers fall into the sea naturally, it is usually distinguished from an intentional General Average sacrifice.
Rule I states that jettison will not be recognized as General Average if the cargo is not carried according to accepted trade practices. However, Rule I does not uniformly exclude all deck cargo from General Average.
For containers stowed on deck of container ships by usual methods, judgment should be made after confirming the ship type, cargo, transport contract, Bill of Lading description, and trade practices.
Continuation of Insurance during Forced Discharge, Reshipment, and Transshipment
Due to severe weather, hull damage, port conditions, or other reasons, cargo may be discharged at an unscheduled port for storage, transshipment, or further carriage.
Clause 8.3 of the Institute Cargo Clauses 2009 provides that insurance continues during delays beyond the control of the insured, route changes, Forced Discharge, Reshipment, Transshipment, and changes of voyage at the carrier’s discretion under the contract of carriage, subject to the insurance termination provisions of Clause 8.1 and Clause 9.
However, Clause 8.3 only governs the continuation of the insurance period. It does not automatically cover all storage charges, delay damages, quality deterioration, or additional costs incurred at the unscheduled port.
| Clause | Main Function | Relation to On Deck Incidents | Practical Response |
|---|---|---|---|
| Clause 8.3 | Continuation of insurance during delays beyond insured’s control, Forced Discharge, Reshipment, Transshipment, etc. | Confirms the insurance period when cargo is unloaded or transshipped at an unscheduled port after an incident. | Record the transshipment date, storage location, onward carriage method, and the circumstances of transport continuation. |
| Clause 9 | Handling when the contract of carriage ends at an unscheduled port or similar | When carriage is terminated, timely notification to the insurer and request for continued coverage become important issues. | Notify the insurer or insurance agent as soon as the contract of carriage termination is known. |
| Clause 12 | Reasonable unloading, storage, and onward carriage costs if insured transport ends at an unscheduled port due to a covered risk | May cover additional costs to transport cargo to the original destination. | Consult with the insurer before incurring costs and keep quotations, invoices, and transport instructions. |
| Clause 4.5 | Exclusion of losses or costs due to delay | Losses solely caused by arrival delays after an incident, even if due to insured risks, may be problematic. | Differentiates between physical damage, temperature deviation, delay, and market losses. |
When cargo is unloaded from the vessel at an unscheduled port, do not assume that “notification to the insurer is unnecessary because Clause 8.3 applies.” Whenever there is termination of the contract of carriage, change of destination, or change of onward carriage method, the need for notification should be confirmed, including consideration of Clause 9 and Clause 10.
Relationship Between Improper Lashing and Clause 4.3
In On Deck incidents, the term "improper lashing" is sometimes used collectively to describe different operations.
However, the process of securing cargo inside the container and the process of securing the container itself on the vessel involve different agents, documentation, insurance exclusions, and liability issues.
| Fixing / Loading Operation | Target | Typical Responsible Party | Main Insurance Issue | Main Liability Issue |
|---|---|---|---|---|
| Vanning inside the container | Cargo inside the container | Shipper, packer, warehouse, or vanning operator | Packing/preparation deficiencies under ICC Clause 4.3 | Cargo weight, center of gravity, securing method, and scope of delegated work |
| Container suitability check | Container itself | Container provider, vanning handler, and user | Container unsuitability under Clause 5.1.2 | Holes, doors, floor, seals, CSC plate, and Equipment Interchange Receipt (EIR) |
| Stowage on board the vessel | Container placement on the vessel | Carrier, vessel, and terminal | Distinction between insured risks and carrier liability | Stowage plan, weight distribution, segregation of dangerous goods, and vessel stability |
| Lashing on board the vessel | Securing containers on deck | Carrier, vessel, or contracted lashing operator | Cause of accident and potential for subrogation | Twist locks, lashing rods, turnbuckles, and Cargo Securing Manual |
Clause 4.3 of ICC 2009 excludes coverage for loss or damage resulting from inadequate or improper packing or preparation that fails to withstand the usual perils of the insured transport. This packing includes the vanning work inside the container.
However, vanning under Clause 4.3 essentially concerns how cargo is arranged and secured inside the container. It does not mechanically apply to the vessel deck lashing that secures the container itself on board the vessel.
Additionally, Clause 4.3 applies when packing or preparation is done by the insured or their employees, or if completed before the insurance commencement. Independent contractors are not considered employees; however, if packing was completed before the insurance started, separate conditions for exclusion may apply.
For stowage and lashing on board the vessel, applicable transport laws, B/L clauses, and the transport contract should be confirmed. If the Hague-Visby Rules apply, the carrier’s duty of due diligence regarding seaworthiness, as well as obligations to properly and carefully load, handle, stow, carry, and care for the cargo, become relevant.
Nevertheless, under the Hague-Visby Rules, cargo stated in the transport contract as carried on deck and actually carried on deck may be excluded from the definition of "goods" under these rules. This exclusion does not occur solely because of the fact that the cargo was carried on deck; both the contract terms and actual stowage must be verified.
Relationship between B/L Notations and Booking Conditions
In container shipping, even if the B/L does not specifically indicate "On Deck," the B/L clauses may allow the shipping line to load containers either on deck or inside the ship’s holds.
Therefore, the absence of an "On Deck" notation on the B/L alone does not guarantee that the container was stowed inside the ship’s hold.
On the other hand, if the shipper has explicitly requested stowage inside the hold, loading in a specific bay, protection of high-value cargo, segregation of dangerous goods, reefer power management, or other conditions, it is necessary to confirm whether these were mere preferences or contract terms accepted by the shipping line or NVOCC.
| Notation / Record | Points to Confirm | Significance in Decision | Notes |
|---|---|---|---|
| Master B/L | Shipping line’s authority for On Deck loading, liability clauses, and governing law | Verifies the maritime transport contract with the Actual Carrier. | It may not be identical to the House B/L terms. |
| House B/L | NVOCC’s On Deck loading clause, scope of responsibility, and liability limits | Confirms the Contracting Carrier’s responsibility to the shipper. | Distinguishes between the Actual Carrier’s acts and the NVOCC’s contractual liability. |
| Booking Confirmation | Records of hold stowage, prohibition of On Deck loading, or special conditions | Checks whether the shipper’s preferences were accepted as transport terms. | Differentiates between Request, Subject to Approval, and Guaranteed conditions. |
| Quotation Terms | Whether stowage position is guaranteed or left to the shipping line’s discretion | Verifies the freight forwarder’s explanation to the shipper. | Ensure written records, not just verbal explanations. |
| Stowage Plan | Actual bay, row, and tier | Confirms the stowage position and surrounding containers at the time of an incident. | The shipping line may not disclose this voluntarily. |
Common Practical Problem Cases
| Case | Main Cause | Documents to Verify | Key Points for Evaluation | Initial Response |
|---|---|---|---|---|
| Container loss due to rough weather | Vessel motion, waves, wind pressure, or lashing failure | Vessel accident report, rough weather records, stowage plan, and lashing records | Distinguish between accidental wash overboard, cargo throwing, or poor stowage. | Immediately notify the insurance company, shipping line, and NVOCC. |
| Seawater exposure | Ingress through door seams, gaskets, ventilation openings, floor, or repair areas | Salt reaction tests, photos of container and cargo, EIR, and survey report | Separate causality between seawater ingress and inadequate cargo packaging. | Secure photos before and after door opening and unpacking. |
| Cargo shifting inside container | Unsuitable cargo weight, center of gravity, or internal securing | Vanning photos, packaging specifications, weight documents, and securing records | Confirm if this relates to internal stowage covered by Clause 4.3. | Do not dispose of cargo or securing materials; arrange for a survey. |
| Improper on-board lashing | Failures of twist locks, lashing rods, or turnbuckles | Lashing records, Cargo Securing Manual, and vessel accident reports | It is important not to confuse on-board handling with internal container stowage. | Request document preservation and disclosure from the shipping line. |
| Reefer temperature incidents | Power shutdown, incorrect settings, equipment malfunction, or delayed alarm response | Temperature charts, alarm logs, data logger, and quality inspection | Confirm causality between deck position (On Deck) and temperature deviations. | Do not dispose of cargo; notify the insurance company and surveyor. |
| Damage after forced discharge | Unplanned unloading, storage, transshipment, or onward carriage at an unscheduled port | Shipping line notifications, storage records, transshipment records, and insurance company notification | Confirm insurance continuation under Clause 8.3 and notification under Clause 9. | Consult with the insurance company before deciding on onward carriage or disposal. |
| Damage to flat rack cargo | Cargo exposure, poor protection, inadequate securing, or over gauge | Stowage plan, securing calculations, photographs, shipping line approval, and booking documents | Confirm if handling conditions are comparable to standard closed containers. | Cross-check special cargo conditions with insurance underwriting requirements. |
| General Average declaration | Entry to refuge port, salvage, fire, grounding, or general safety measures | General Average notice, General Average Bond, and General Average Guarantee | Delineate physical damage, sacrifice damage, and apportionment contributions. | Request the insurance company to arrange collateral for cargo release. |
Supporting Documents and Responses by Accident Cause
| Cause of Accident | Insurance Issues | Supporting Documents | Practical Responses |
|---|---|---|---|
| Severe Weather and High Waves | Causal relationship with covered risks; distinction from normal voyage motion | Voyage log, weather records, shipping line notices, and survey reports | Confirm other container incidents on the same voyage and notify of the accident promptly. |
| Container Loss Overboard | Washing overboard, jettison, total loss, general average, and carrier liability | Container number, loading position, B/L, insurance policy, and accident report | Simultaneously organize insurance claims, general average, and recourse processes. |
| Inadequate Lashing | Whether due to unavoidable severe weather or improper stowage and securing on board | Stowage plan, lashing records, Cargo Securing Manual, and accident photographs | Record dates and details of document requests to the shipping line and their responses. |
| Container Damage | Damage location, container suitability, and causal link to cargo damage | EIR, external photos, and photos of doors, floor, sidewalls, and ceiling | Compare conditions at pickup, in-gate, arrival, and return. |
| Seawater Ingress | Seawater or freshwater, container damage, or inadequate packing | Salt detection test, wet damage photos, packing photos, and weather records | Secure evidence before moving or disposing of the cargo. |
| Reefer Temperature Deviation | Equipment failure, power outage, incorrect settings, delays, or cargo-specific characteristics | Reefer logs, temperature charts, alarms, and quality certificates | Organize deviation temperatures, duration, and causal link to quality deterioration. |
| Violation of Special Cargo Conditions | Failure to declare, shipping line approval, stowage conditions, and insurance terms | Booking, SDS, dimension and weight documents, and shipping line responses | Chronologically document the shipper’s declaration, freight forwarder’s communication, and approvals. |
Documents Important as Evidence
| Document Category | Main Documents | Details to Confirm | Notes |
|---|---|---|---|
| Cargo Insurance | Insurance Policy, Insurance Application, ICC Clauses, Special Clauses, and Warranties | Coverage scope, exclusions, insurance period, and declared contents | Check not only the insurance policy title but also the embedded wording. |
| Transport Contract | Master B/L, House B/L, Waybill, and Transport Clauses | On-deck stowage authority, governing law, liability limits, and notification deadlines | Delineate the liability relationship between Master B/L and House B/L. |
| Booking | Booking Confirmation, Shipping Instructions, Quotation Terms, and Emails | Whether stowage inside the ship’s hold or other preferences became contract terms | Distinguish between mere requests and firm confirmations. |
| Vessel and Stowage | Stowage Plan, Lashing Records, Logbook, and Incident Reports | Stowage position, severity of rough weather, securing conditions, and cause of incidents | Retain the chronology of document requests themselves as evidence. |
| Container Condition | EIR, Exterior Photos, Photos of Doors, Seals, Floor, Side Walls, and Ceiling | Presence of container damage and which segment it occurred in | Secure exterior photos taken before opening the doors. |
| Cargo Damage | Unpacking Photos, Damage Details, Inspection Reports, and Repair Estimates | Damage extent, quantity, cause, and damage amount | Avoid unauthorized disposal of damaged cargo. |
| Reefer | Setting Records, Temperature Charts, Alarm History, and Data Loggers | Time and duration of temperature deviations, and causality with quality | Also verify any time differences between vessel logs and cargo-side loggers. |
| General Average | General Average Notice, General Average Bond, General Average Guarantee, and Settlement Documents | Provision of security, contribution amount, sacrificed damage, and costs | Contact the insurance company in time to meet the cargo delivery deadline. |
Freight Forwarder Standard Five Classifications and On Deck Incidents
The Five Classifications in this article are not established by law or the entire industry but serve as an analytical framework used in this series to organize the scope of freight forwarder involvement.
| Classification | Main Involvement in On Deck Transport | Pre-Incident Confirmation Items | Post-Incident Actions | Scope Not Automatically Assumed |
|---|---|---|---|---|
| 1. Simple Intermediary | Acts as an intermediary for booking, communication, and document exchange between the cargo owner and the shipping line or NVOCC. | Accurately conveys requests such as stowage inside the ship's hold and relays responses to the cargo owner. | Supports incident notification, document requests, and communication among related parties. | Does not guarantee stowage position, on-deck lashing, or cargo condition unless explicitly accepted. |
| 2. Cargo Transportation Service Provider | Provides cargo transport services to the cargo owner using the Actual Carrier’s transportation capabilities. | Confirms contract carriage agreements, applicable clauses, stowage conditions, and insurance arrangement scope. | Verifies contractual transport liability and pursues claims against the Actual Carrier while preserving evidence. | Does not assume unlimited liability for all incidents. |
| 3. NVOCC / House B/L Issuer | Issues House B/L and acts as Contracting Carrier in relation to the cargo owner. | Checks House B/L on-deck stowage clause, liability clauses, and its relationship with the Master B/L. | Responds to cargo owner’s Claim Letter, notifies the Actual Carrier, and preserves rights of recourse. | Does not inherently imply having performed actual on-deck lashing work. |
| 4. Door-to-Door Single Contractor | Assumes integrated responsibility from collection to final delivery as a comprehensive service. | Organizes the ocean leg, vanning, insurance, reefer conditions, and subcontractor roles. | Specifies the incident segment, manages insurance claims, cargo owner communications, and subcontractor recourse. | Does not imply unlimited liability for all transportation segments and causes. |
| 5. Agent/Coordinator for Specific Operations | Performs specific tasks such as inquiries about stowage inside the ship’s hold, confirmation of special conditions, or document acquisition. | Clarifies the requested tasks, response deadlines, and contact points. | Within the delegated scope, conducts inquiries to the shipping line, obtains documents, or coordinates surveys. | Does not take on undirected transport contracts, stowage management, insurance arrangements, or overall incident handling. |
The concepts of Contracting Carrier and Actual Carrier represent legal or contractual statuses and are not alternative classifications replacing the Standard Five Classifications in this article.
Furthermore, actual operational tasks such as packing, vanning, inspection, container stowage, on-deck stowage, lashing, storage, and delivery do not themselves constitute a sixth classification.
Actual liability is determined by considering not only the Five Classifications but also contract documents, Bills of Lading, quotation terms, mandates, issued documentation, and the actual conducted operations collectively.
Example 1: Containers Lost Overboard Due to Rough Weather
Consider a case where dry containers exported from Japan to Europe are loaded on deck, and several containers are lost overboard during rough weather at sea.
The first step is not only to check whether the B/L indicates On Deck but also to confirm the actual stowage location, the shipping line’s accident report, the number of containers lost on the same voyage, weather conditions, and whether any lashing had failed.
For marine cargo insurance under ICC(B), it is necessary to verify whether the incident qualifies as Washing Overboard. Under ICC(C), a distinction must be made between accidental washing overboard and jettison deliberately made for general average purposes.
If the master intentionally jettisoned the containers for the common safety, it may be treated as a general average sacrifice. On the other hand, if the lashings broke due to rough weather and the containers fell overboard naturally, this would differ from an intentional general average sacrifice.
The freight forwarder should avoid making a definitive judgment on insurance claim validity. They should simultaneously notify the insurance company of the incident, secure the B/L and booking documents, request documentation from the shipping line, and confirm the deadline for subrogation notice.
Example 2: Suspected Lashing Deficiency Causing Seawater Damage
Assume that containers on deck come into contact with adjacent containers during rough weather, resulting in deformation of the door area and seawater damage to the cargo inside.
In this case, responsibility should not be decided based solely on the term "lashing deficiency." First, it is necessary to distinguish whether the cargo inside the container was properly packed and secured, whether there were any existing holes or door gasket defects in the container itself, or whether there was an issue with securing the containers on board the vessel.
If the cargo inside the container was inadequately secured and could not withstand normal ship motion during the voyage, ICC Clause 4.3 may become relevant.
On the other hand, if a twist lock or lashing rod on board the vessel broke causing containers to collide, the focus would be on the vessel’s on-deck lashing and the carrier’s cargo management obligations. Clause 4.3 should not be directly applied to on-deck lashing deficiencies.
Photographs of the container exterior before opening, door deformation, salt residue, the pattern of cargo wetting, stowage plans, rough weather logs, and records of requests for documentation from the shipping line should be preserved, proceeding separately with insurance claims and claims against the carrier.
Example 3: Reefer Container Temperature Incident
Consider a reefer container loaded with frozen food placed on deck, where the power supply was interrupted during the voyage, resulting in temperatures exceeding the set limits.
The fact that the container was stowed on deck alone does not determine the cause of the temperature incident. It is necessary to separately verify whether the cause was shipboard power shutdown, plug connection failure, reefer equipment malfunction, incorrect temperature setting, delayed alarm response, insufficient pre-cooling of the cargo, or intrinsic quality changes in the cargo.
If, after the incident, the cargo was forcibly discharged at an unscheduled port and transshipped onto another vessel, confirmation of insurance continuation under Clause 8.3 should be made. However, continuation of insurance and coverage for temperature deterioration are separate issues.
If the temperature deviation was caused merely by transport delay, exemption from liability for delay may become an issue. In cases where the temperature rise was due to a physical power failure or mechanical accident, the applicable temperature variation clause and insurance terms should be verified.
After securing reefer logs, alarm history, data logger records, temperature setting instructions, quality inspection reports, and storage records following forced discharge, decisions can be made regarding disposal or sale of the cargo.
Common Misunderstandings
| Misunderstanding | Actual Consideration | Practical Notes |
|---|---|---|
| If there is no On Deck notation on the B/L, the cargo must be stowed inside the ship's hold. | For container ships, the shipping line may stow cargo either on deck or inside the hold according to the B/L clause. | Check the B/L clauses, booking conditions, and actual stowage plans. |
| ICC(A) covers all damages occurring on deck without exception. | ICC(A) is subject to exemptions from Clause 4 to Clause 7, and confirmation of causation. | Verify packing defects, delays, inherent qualities of the cargo, and intentional acts. |
| ICC(C) always covers container loss due to rough weather. | ICC(C) is a limited named-perils coverage; accidental washing overboard and jettison are not the same. | Confirm which peril under Clause 1 corresponds to the incident circumstances. |
| All containers that fall into the sea are considered jettison. | Jettison means deliberate casting overboard and is distinguished from accidental loss due to rough weather. | Check the master’s report, accident report, and general average declaration details. |
| If general average is declared, all cargo damage automatically becomes general average. | Accidental damage, general average sacrifices, and general average contributions are separate items. | Confirm the judgments of the general average adjuster and insurance company. |
| Rule I excludes all on-deck cargo from general average. | Rule I requires jettison to be in accordance with recognized trade customs for the transport. | Individually verify vessel type, B/L notations, cargo type, and trade customs. |
| If Clause 8.3 applies, all costs and delay damages at unscheduled ports are fully covered. | Clause 8.3 primarily stipulates continuation of the insurance period. | Check Clause 12 for costs and Clause 4.5 etc. for delay damages separately. |
| Clause 4.3 directly regulates deficiencies in lashing on the vessel. | Clause 4.3 focuses on stowage inside the container, i.e., loading cargo into the container. | Delineate between on-vessel lashing and cargo securing within the container. |
| The freight forwarder automatically guarantees stowage inside the ship’s hold. | Generally, the final stowage location is determined by the shipping line or vessel side. | Distinguish and document guarantees, conditional approvals, and mere requests. |
Accident Handling Decision Checklist
| Situation for Confirmation | Party to Confirm With | Items to Confirm | Actions if Issues Are Found |
|---|---|---|---|
| At Discovery of Accident | Cargo Owner, Warehouse, Delivery Agent | Condition of Cargo, Container, Seal, Moisture Damage, Physical Damage, and Temperature Anomalies | Take photographs before moving, repairing, or discarding and notify the insurance company. |
| At Vanning Position Confirmation | Shipping Line, NVOCC, Agent | Loading Position On Deck or in Hold, Bay, Row, and Tier | Request the stowage plan and record the request date and response details. |
| At Insurance Terms Confirmation | Insurance Company, Insurance Agent | ICC Clauses, Endorsements, Warranties, Underdeck or On-Deck Clause, and Insurance Period | Do not independently decide coverage eligibility; request formal confirmation. |
| At B/L Confirmation | Shipping Line, NVOCC, Freight Forwarder | Authority for On-Deck Loading, Governing Law, Liability Limitations, and Notification Deadlines | Separate and organize Master B/L and House B/L. |
| At Booking Confirmation | Shipper, Freight Forwarder, Shipping Line | Stowage Inside Hold, Special Terms, and Shipping Line Approval Status | Differ between shipper’s request and conditions accepted by the shipping line. |
| At Accident Cause Confirmation | Surveyor, Shipping Line, On-site Staff | Inclement Weather, Washing Off, Cargo Dropping, Lashing, Seawater Intrusion, and Packing Condition | Avoid speculation; conduct additional investigations and documentation requests. |
| At General Average Confirmation | Insurance Company, General Average Adjuster, Shipping Line | General Average Declaration, Provision of Security, Sacrificial Damage, and Contribution Amount | Arrange General Average Bond and General Average Guarantee promptly. |
| At Forced Discharge | Shipping Line, NVOCC, Insurance Company | Discharge Port, Storage Location, Continuation or Termination of Transport Contract, Transshipment Plan | Confirm Clause 9 notification requirements and whether continued coverage is necessary. |
| At Reefer Accident | Shipping Line, Terminal, Surveyor | Set Temperature, Power Supply, Alarms, Duration of Deviation, and Quality Deterioration | Preserve logs and conduct quality inspection before cargo disposal. |
| At Subrogation Consideration | Insurance Company, NVOCC, Shipping Line, Maritime Lawyer | Accident Segment, Contractual Liability, Negligence, Liability Limits, and Notification Deadlines | Send Claim Letter to preserve statute of limitations and subrogation rights. |
| At Explanation to Shipper | Shipper, Insurance Company, Internal Responsible Personnel | Insurance Terms, Accident Cause, Items Under Investigation, and Future Procedures | Avoid definitive statements such as "insurance will definitely pay" or "shipping line is always liable." |
Important Points in Practical Operations for Freight Forwarders
When freight forwarders or NVOCC receive special instructions from the cargo owner, such as stowage inside the ship’s hold, they must accurately convey these conditions to the shipping line and report the shipping line’s response back to the cargo owner.
There is a significant difference between the shipping line responding with "we will accommodate as much as possible" and the shipping line guaranteeing stowage inside the ship’s hold. Quotations, booking confirmations, and emails should clearly distinguish between requests, conditional approvals, and firm guarantees.
After an incident, it is important not to confuse compensation provided under marine cargo insurance with the liability of the carrier or freight forwarder. Even if insurance compensation is paid, it does not necessarily mean the carrier is not held liable.
Conversely, even if recourse against the shipping line is possible, it does not automatically guarantee immediate payment of insurance proceeds from the marine cargo insurance. Each case should be judged based on the relevant contracts, clauses, exclusions, and evidence.
Loading diagrams, lashing records, the Cargo Securing Manual, voyage logs, and vessel accident reports from the shipping line may not be voluntarily disclosed to the cargo owner or freight forwarder. In such cases, the date and time of the request, content of the request, and the response should be documented in the records.
Situations to Consider Consulting a Maritime Lawyer
When container loss, multiple container incidents, high-value cargo, general average, salvage charges, insufficient lashing, carrier seaworthiness, on-deck notation on the B/L, or claims for compensation against the freight forwarder become issues, early consultation with a maritime lawyer should be considered.
In particular, if the shipping line refuses to disclose stowage plans or lashing records, if there is a dispute over whether bad weather or poor stowage was the main cause, or if foreign law or foreign arbitration applies, handling the matter solely within insurance practice may be difficult.
Because recourse notifications, statute of limitations extensions, jurisdiction, arbitration clauses, and liability limits become issues, it is important not to wait for damages to be finalized before taking legal action, but rather to proceed with evidence preservation and notifications immediately after the incident occurs.
Summary
On container ship transport, containers stowed on deck are commonly used in normal operations. Therefore, it is necessary to distinguish between deck stowage of loose cargo on conventional vessels and containers placed on deck on container ships.
However, even with ordinary on-deck stowage, risks remain such as adverse weather, container loss overboard, washing off, deliberate jettison, seawater ingress, inadequate shipboard lashing, improper stowage inside the container, and reefer temperature incidents.
In marine cargo insurance, distinction is made between the all-risk coverage of ICC(A) and the named perils coverage of ICC(B) and ICC(C), with the roles of Clause 2, Clause 4.3, Clause 5.1.2, Clause 8.3, Clause 9, and Clause 12 confirmed separately.
In General Average, accidental loss overboard, intentional jettison, General Average sacrifices, and General Average contributions must not be confused. Rule I of the York-Antwerp Rules does not uniformly exclude all on-deck cargo.
Regarding lashing incidents, it is important to separate cargo securing inside the container from container securing on the vessel. The container stowage provisions in Clause 4.3 cannot be mechanically applied to shipboard lashing.
Freight forwarders and NVOCCs should not confuse requests for stowage inside the ship’s hold with insurance conditions, and should retain records from booking instructions, shipping line responses, insurance terms, and documentation requests after an incident.
This article provides an overview of general marine cargo insurance and international logistics practice and does not guarantee claim payments, legal liability, acceptance of General Average, or recoverability in individual cases. Actual assessments require verification of the insurance policy, Bill of Lading, applicable Clauses, governing law, incident documents, and contractual relations on a case-by-case basis.
Marine cargo insurance conditions impact coverage more than premium. For selection of insurance terms and Clause interpretation, please consult specialist insurance companies or insurance agents.
