Category: Marine · Reviewed by Simon Temme, Account Executive · Last reviewed 2026-06-05
The Institute Cargo Clauses (C), reference CL.384 dated 1/1/2009, are the narrowest of the three principal marine cargo wordings in the London market, providing cover only for loss of or damage to insured goods caused by a short list of major casualties such as fire, explosion, stranding, collision and jettison.
Category: Marine insurance Also known as: ICC (C), ICC C, CL.384, narrowest ICC, FPA-equivalent First codified: Institute Cargo Clauses (Sea) FPA 1963; ICC (C) 1/1/82; current ICC (C) 1/1/2009 (CL.384) Related legislation: Marine Insurance Act 1906 [1]; Insurance Act 2015 [2]
The Institute Cargo Clauses (C) are the most restricted of the three principal marine cargo wordings maintained by the Joint Cargo Committee for the London market. The current version, dated 1/1/2009 and assigned market reference CL.384, replaced the earlier ICC (C) 1/1/82. ICC (C) is the modern equivalent of the historic ‘Free of Particular Average’ (FPA) wording: it covers only major casualties, leaving the assured to bear all other partial losses [3][4].
The structure of ICC (C) is identical to ICC (A) and ICC (B), with 19 numbered clauses covering risks, exclusions, duration, claims, benefit of insurance, minimising losses and applicable law. The substantive difference lies in cl.1 (risks covered), which omits several of the perils listed in ICC (B): notably earthquake, lightning, washing overboard, entry of seawater into the hold, and total loss of packages lost overboard during loading or unloading. The exclusions in cl.4 are otherwise the same as ICC (B), including the exclusion for deliberate damage by wrongful act [3].
ICC (C) is the Incoterms minimum cover required of a CIF seller (where the CIF Incoterm continues to require only ICC (C) level cover unless the sales contract specifies more). The CIP Incoterm under Incoterms 2020 was upgraded to require ICC (A) cover as the minimum, leaving CIF as the principal trade term where ICC (C) is the default [3][4].
ICC (C) is used principally for bulk commodities of low intrinsic value where buyers and sellers in the trade have historically accepted the narrowest cover. It is also sometimes used for highly resilient cargoes (such as iron ore or aggregates) where partial damage is unlikely or commercially unimportant, and where the principal exposure is to total loss from major casualty.
ICC (C) is governed by the Marine Insurance Act 1906 and, for commercial contracts entered into after 12 August 2016, modified by the Insurance Act 2015. Clause 19 provides that the insurance is subject to English law and practice [1][2][3].
The named-perils framework in cl.1 of ICC (C) places the burden on the assured to prove that the loss falls within one of the listed perils. The covered perils are: loss or damage reasonably attributable to fire or explosion; the vessel or craft being stranded, grounded, sunk or capsized; overturning or derailment of land conveyance; collision or contact of vessel, craft or conveyance with any external object other than water; discharge of cargo at a port of distress (cl.1.1); and loss or damage caused by general average sacrifice or jettison (cl.1.2). The cover also includes contribution to general average and salvage charges (cl.2) and the ‘both to blame collision’ clause (cl.3) [3].
The notable omissions from ICC (C) - present in ICC (B) but not (C) - are earthquake, volcanic eruption and lightning; washing overboard; entry of seawater, lake water or river water; and total loss of any package lost overboard or dropped whilst loading or unloading. The omission of seawater ingress is particularly significant for bulk cargo, as wet damage to part of a bulk cargo from a breach of the hold is one of the more common partial loss scenarios. Under ICC (C), such losses fall back on the assured unless they arise from one of the listed major casualties.
The exclusions in cl.4–7 mirror those of ICC (B), including the wilful misconduct exclusion, the ordinary wear and tear exclusion, the insufficient packing exclusion, the inherent vice exclusion, the delay exclusion, the carrier insolvency exclusion, the unseaworthiness exclusion (where the assured is privy), the war exclusion in cl.6 and the strikes exclusion in cl.7. Clause 4.7 of ICC (C) also excludes deliberate damage by wrongful act of any person [3][4].
ICC (C) is incorporated into a policy by reference and used with the MAR 91 schedule. Annual open covers using ICC (C) are common for bulk commodities of low unit value where the cost differential against ICC (A) or (B) is material. The premium saving for ICC (C) compared with ICC (A) can be significant, particularly on bulk dry cargo and certain bulk liquid trades [3][4].
For a CIF sale with no specific cover requirement in the contract, the seller satisfies the Incoterm by arranging ICC (C) cover. In practice, many CIF sales contracts now require ICC (A) or ICC (B) by specific clause, recognising that the Incoterms minimum is often inadequate for the buyer’s needs. Letter of credit instructions sometimes specify the required ICC level.
The cover responds well to its core scenarios. A vessel grounding causing damage to cargo is covered, as is fire damage in the hold, an engine room explosion damaging adjacent cargo, or a collision between vessels. Jettison (the deliberate throwing overboard of cargo to lighten a vessel in distress, undertaken for the common safety) is covered, as is general average sacrifice and salvage contribution. These are the classic catastrophic exposures that ICC (C) was designed to address.
What ICC (C) does not cover includes: heavy weather damage to cargo (other than from listed perils); seawater ingress through a damaged hatch or ventilator; pilferage; malicious damage; theft; shortage on arrival; condensation or sweat damage; loss of containers overboard during a heavy weather rolling event (unless the vessel itself was stranded or sunk). These risks fall back on the assured under ICC (C).
ICC (C) is the historical basis for many trade-specific commodity clauses. The grain trade, oilseeds trade and certain bulk metals trades have long used ICC (C) supplemented by trade-specific extensions. The Federation of Oils Seeds and Fats Associations (FOSFA), the Grain and Feed Trade Association (GAFTA) and similar trade associations reference ICC wordings in their standard sale contracts, with the choice between ICC (A), (B) and (C) typically left to the contract [3][4].
Cover for war and strikes risks operates the same way as for ICC (A) and (B): the war and strikes exclusions in cl.6 and cl.7 are excluded from the main wording, and Institute War Clauses Cargo and Institute Strikes Clauses Cargo are placed separately.
The 1/1/82 version of ICC (C) remains in occasional use in some markets. The American Institute Marine Cargo Clauses include a parallel narrow wording sometimes used in US placements.
Specific extensions to ICC (C) commonly added include the Theft, Pilferage and Non-Delivery (TPND) clause for goods susceptible to theft, the Malicious Damage clause (CL.266), and the Refusal of Import (RFI) clauses for goods that may be rejected by destination authorities. Each extension restores cover for a specific exposure not provided under base ICC (C).
A bulk cargo of 60,000 tonnes of iron ore is shipped from Australia to China on a Capesize bulker. The shipowner takes ICC (C) (CL.384) plus War and Strikes clauses, on an insured value of approximately $5.4m. During the loaded passage the vessel suffers a serious engine room fire, which spreads to the lower hold and damages approximately 4,000 tonnes of ore through fire and water from firefighting efforts. The vessel diverts to a port of refuge and discharges part of the cargo to allow repairs. General average is declared by the shipowner. The cargo insurer pays the assured’s share of the cargo loss from the fire (covered under cl.1.1 of ICC (C)), the assured’s contribution to general average (covered under cl.2), and the cargo loss attributable to firefighting water entering the hold (also reasonably attributable to fire). The ICC (C) wording responded as designed to a major casualty scenario. Had the loss instead been caused by hold ventilation failure leading to condensation damage, no cover would have been available under ICC (C).
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-05. Next review: 2026-12-05.
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