Category: Marine · Reviewed by Tim Roche, Director · PI & Commercial · Last reviewed 2026-06-05
The Institute War Clauses Cargo, reference CL.385 dated 1/1/2009, restore cover for war and warlike risks excluded from the standard Institute Cargo Clauses, subject to the waterborne agreement that limits cover to the period the goods are on board an overseas vessel.
Category: Marine insurance Also known as: IWCC, war clauses cargo, war risks cargo, CL.385 First codified: Free of Capture and Seizure (FC&S) clause c.1898; Waterborne Agreement 1937; current IWCC (Cargo) 1/1/2009 (CL.385) Related legislation: Marine Insurance Act 1906 [1]; Insurance Act 2015 [2]
The Institute War Clauses Cargo are a separate London market wording that restore cover for the war risks excluded by cl.6 of the standard Institute Cargo Clauses ((A), (B) and (C)). They are commonly placed alongside the standard ICC at the time of cover incepting, with the war premium often charged as a small additional percentage of the cargo premium and adjusted according to the routes and trading patterns [3][4].
War risks for cargo trace back to the Free of Capture and Seizure (FC&S) clause introduced into hull and cargo policies during the late 19th century, excluding war-related losses from the main marine cover. After heavy market losses during the First World War led to a separate war insurance market, the Joint War Committee was formed and the Institute War Clauses developed as a standardised wording. The Waterborne Agreement of 1937 codified the principle that cargo war cover is limited to the period the goods are waterborne on an overseas vessel [3][5].
The current IWCC (Cargo) 1/1/2009 (CL.385) cover loss or damage to the subject-matter insured caused by: war, civil war, revolution, rebellion, insurrection or civil strife arising therefrom, or any hostile act by or against a belligerent power; capture, seizure, arrest, restraint or detainment, and the consequences thereof or any attempt thereat; and derelict mines, torpedoes, bombs or other derelict weapons of war (cl.1). The cover also includes contribution to general average and salvage charges incurred to avoid or in connection with the avoidance of loss from a covered risk (cl.2) [3].
The cover does not include terrorism or politically motivated damage by persons acting from a political, ideological or religious motive - these are covered separately under the Institute Strikes Clauses Cargo (CL.386).
The IWCC are governed by the Marine Insurance Act 1906 and, for commercial contracts entered into after 12 August 2016, modified by the Insurance Act 2015. Clause 14 provides that the insurance is subject to English law and practice [1][2][3].
The duration provisions in cl.5 of the IWCC reflect the historic Waterborne Agreement of 1937. Cover begins when the goods are loaded on board an overseas vessel and ends either as they are discharged from that vessel at the destination port, or on the expiry of 15 days from midnight of the day of arrival of the vessel at the destination port, whichever is earlier. Cover for transhipment continues during the time of transhipment and any period of waiting between vessels, subject to a maximum of 15 days at any intermediate port [3].
The Waterborne Agreement was a market accord between London market underwriters following heavy losses on cargo war business in the 1930s, restricting cover to the waterborne portion of the voyage. The principle continues to be reflected in the IWCC duration clause and is a key conceptual difference between cargo war risks (waterborne only) and strikes risks (which extend to land transit).
The exclusions in cl.3 mirror those of the underlying ICC, with key items including: ordinary leakage and wear and tear (cl.3.1.1); insufficient packing (cl.3.1.3); inherent vice (cl.3.1.4); delay (cl.3.1.5); insolvency of the carrier (cl.3.1.6); nuclear weapons (cl.3.1.10); chemical, biological, biochemical or electromagnetic weapons (cl.3.1.11); and cyber attack (cl.3.1.12, added by clause amendment). The unseaworthiness exclusion in cl.4 (where the assured is privy) applies in the same terms as under the standard ICC [3][4].
The Joint War Committee, comprised of underwriters from the Lloyd’s Market Association and the International Underwriting Association, publishes the Joint War Committee Hull Areas List which identifies areas where additional war risk premiums and notice provisions apply. The areas list is reviewed regularly and influences both hull and cargo war placements.
The IWCC are placed alongside the standard ICC at the time of cover incepting. For an annual open cover, the war placement is typically with the same panel of insurers as the main cargo cover, on parallel slip terms, with a separate small premium for war risks. Single-shipment war placements are also available where the underlying ICC is on a one-off basis [3][4].
Voyages through areas listed by the Joint War Committee attract additional premium, notice provisions and sometimes restrictions on the duration of port stays. The areas list has historically included parts of the Gulf of Aden and Red Sea, areas off West Africa, the Black Sea (varying with regional conflicts), and other regions where political risk or piracy exposures elevate. Cancellation provisions allow underwriters to terminate cover on relatively short notice (typically 7 days) in respect of war risks, with the cancellation period varying by region and circumstance.
Claims under the IWCC are handled in the same way as standard cargo claims, with the assured notifying the insurer’s correspondent at the loss location, providing documents, and an adjustment being prepared. War risks claims often involve issues of causation (whether the loss is properly attributable to a covered war risk or to an excluded cause), and may involve consultation with the Joint War Committee on market-wide events.
A practical consequence of the waterborne-only cover is that goods are covered during the sea passage but not during overland transit before loading or after discharge. The companion Institute Strikes Clauses Cargo provide the corresponding land cover for strikes, riots and politically motivated damage, but the standard war cover does not extend to land risks. Some assureds buy bespoke ‘war risks ashore’ cover for cargo at warehouses in conflict zones, though this is a specialist market.
Several specialised war wordings exist for particular trades and exposures. The Institute War Clauses for Sendings by Post (CL.391) cover postal shipments. The Institute War Clauses Air Cargo (CL.388) provide parallel cover for air shipments, with corresponding duration provisions tied to the air carriage. The Institute War Clauses for Bulk Oil (CL.275) and similar trade-specific wordings address particular commodity exposures [3][4].
For high-risk areas, additional clauses and endorsements are common. The Joint War Committee Hull Areas List is referenced for premium and notice provisions, and ‘breach’ clauses provide for additional premium if vessels deviate into listed areas. Russia and CIS area war cover saw substantial market repricing during 2022 following the invasion of Ukraine, with significant restrictions on cover for vessels and cargoes in the Black Sea and certain Russian ports.
The cyber exclusion (CL370 or the more nuanced LMA5403 with carve-out for affirmative cyber cover) is commonly attached, reflecting market concerns about state-sponsored cyber attack being characterised as a war-like act.
A UK trading house ships a consignment of project cargo (industrial transformers and switchgear) worth £4.2m from a Northern European port to a port in the Middle East. The route transits the Mediterranean and the Gulf, with the destination port being within a Joint War Committee listed area for the relevant period. Standard ICC (A) cover is in place under the trading house’s annual open cover. The Institute War Clauses Cargo (CL.385) are placed alongside, with an additional war premium reflecting the listed area transit. During the voyage the vessel is detained in a port of call by local authorities for several days as a result of regional political tension, but no physical damage to cargo occurs. Some delay-related charges (storage, demurrage on equipment hire) are incurred but are excluded by the delay exclusion in cl.3.1.5. Had the cargo suffered physical damage from detention or from a derelict mine in the Gulf, the cover would have responded to the physical loss.
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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