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What geographical trading restrictions are often attached to marine insurance policies?

In policies to which the Institute Time Clauses – Hulls (1/10/83) (1/10/83) are attached, the shipowner often gives a warranty that the ship will trade “within Institute Warranty Limits” (IWLs). 

These prohibit the ship from entering the extreme northern and southern latitudes and other ice-prone areas of the world such as the Atlantic coast of North America, the Great Lakes, Greenland waters, Baltic Sea, Bering Sea and northern Far East waters unless amended terms are agreed; carriage of Indian coal in eastern waters during the summer months is also prohibited. Breach of IWLs is a breach of warranty, discharging the insurer from the contract as a whole. However, the International Hull Clauses (01/11/03) include a Navigating Limits clause restricting entry to virtually the same areas, but which does not operate as a warranty and only deprives the owner of cover for loss or damage while the ship is within a prohibited area.

 

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