Global conflicts and geopolitical tensions can significantly disrupt trade routes, shipping schedules, and cargo safety. For businesses relying on marine insurance, understanding how coverage applies during such events is essential.
Here’s a clear breakdown to help you navigate coverage during such situations.
What happens during a war or geopolitical conflict?
When conflict arises, especially near key trade routes or ports, it can lead to:
- Route diversions and delays
- Port closures or restricted access
- Increased risk to cargo and vessels
- Cargo seizure or detention
- Government-imposed trade restrictions
Why are conflict-related losses excluded?
Standard marine insurance policies are designed to cover unforeseen and accidental transit risks.
However, losses arising from geopolitical events fall under the War Exclusion Clause, which removes coverage for large-scale and systemic risks that insurers cannot standardly underwrite.
War-related coverage summary
War is entirely excluded under standard marine insurance policies.
The policy does not cover:
- War, civil war, revolution, rebellion, insurrection, civil strife
- Hostile acts by or against a belligerent power
- Capture, seizure, arrest, restraint or detainment
- Derelict mines, bombs or other weapons of war
- Government intervention relating to war-like events
- Terrorism and politically motivated violence
- Chemical, biological, bio-chemical or electromagnetic weapons
- Cyber warfare used as a weapon
What is not covered in such situations?
If your shipment is disrupted due to conflict, the following are generally not admissible:
- Trip or shipment delays due to rerouting or closures
- Loss or damage caused by war-related events
- Confiscation or detention of goods
- Supply chain disruption losses
- Indirect or consequential losses
What remains covered?
Your marine insurance policy continues to provide protection for:
- Accidental damage unrelated to conflict
(for example, collision, overturning, fire during transit)
- Natural calamities (if covered under the policy)
- Transit-related risks such as theft, mishandling, loading or unloading damage
- Fire or explosion not linked to conflict
What should businesses do during conflict situations?
- Review policy wording carefully
- Monitor routes and geopolitical developments
- Coordinate with logistics partners and insurers
- Plan for delays and alternate routes
Final takeaway
Marine insurance continues to protect against standard transit risks. However, losses caused by war, conflict, or related government actions remain excluded under policy terms.
Understanding your coverage and staying informed can help you manage risk more effectively during uncertain times.
Disclaimer: The information provided in this blog is for educational and informational purposes only. It is advised to verify the currency and relevance of the data and information before taking any major steps. Please read the sales brochure/policy wordings carefully for detailed information about on risk factors, terms conditions and exclusions. ICICI Lombard is not liable for any inaccuracies or consequences resulting from the use of this outdated information.