For much of modern shipping history, war risk was treated as an exceptional peril: serious, certainly, but geographically limited and commercially episodic. It appeared in negotiations when a vessel was ordered to a recognised conflict zone, when underwriters issued a circular, or when a charterparty rider required amendment before fixture. That world has changed. Today, war risk is no longer a remote clause buried in the back of a standard form. It has become a recurring commercial, operational and legal reality for shipowners trading through the Red Sea, the Strait of Hormuz, the Black Sea and the Eastern Mediterranean.
This development matters because war risk does not affect only the safety of the ship. It alters the economics of the voyage, the availability and cost of insurance, the validity of charterers’ orders, the legal status of ports and berths, and the allocation of delay, deviation and additional premiums. A voyage that appears commercially sound at the time of fixture may become materially different once an additional war risk premium, a longer route around the Cape of Good Hope, increased bunker consumption, crew risk allowances, armed security costs and potential off-hire arguments are added to the calculation. For shipowners, the modern question is no longer simply whether a region is dangerous. The sharper question is: who bears the legal and financial consequences of that danger?
The answer will usually be found in the interaction between the charterparty, the insurance programme and the factual risk assessment available at the time of decision. English law remains central to this analysis because many international charterparties, bills of lading and marine insurance disputes are governed by English law or resolved in London arbitration. The authorities show a consistent theme: the law recognises genuine danger, but it does not reward vague anxiety, commercial opportunism or poorly documented decision-making. War risk must be assessed with precision.
The New Geography of Maritime War Risk
The Red Sea has become one of the clearest examples of war risk entering mainstream voyage planning. For decades, the Suez Canal route was primarily a commercial calculation involving distance, canal dues, time savings and bunker efficiency. Once attacks on merchant shipping and naval-security concerns became part of the operational landscape, the decision changed character. Avoiding the Red Sea by routing around the Cape may reduce exposure to hostile action, but it creates its own consequences: longer voyages, higher fuel costs, delayed delivery, disrupted liner schedules and disputes over whether the resulting time and expense are for owners’ or charterers’ account.
The Strait of Hormuz presents a different but equally serious profile. It is a strategic chokepoint for energy trade and is vulnerable to state interference, seizure, naval confrontation, mines, drones and retaliatory escalation. The legal risk is not limited to physical attack. A vessel may be detained, delayed, sanctioned, investigated or prevented from trading because of cargo, ownership, flag, financing or counterparties. In this context, a shipowner’s war risk assessment must include not only navigational safety but also sanctions compliance and insurance recoverability.
The Black Sea remains a particularly complex theatre because war-related risks may include mines, missile strikes, port restrictions, drone activity, military exclusion areas and rapidly changing export corridors. A port may be physically capable of receiving a ship yet legally unsafe if the vessel cannot reach it, remain there and depart without exposure to danger that cannot be avoided by ordinary seamanship. The Eastern Mediterranean, by contrast, may present a more uneven picture: some trades continue without interruption, while others become sensitive due to regional escalation, naval activity, cargo identity, sanctions exposure or proximity to conflict.
For owners, the lesson is that modern war risk is not confined to one sea lane or one form of peril. It is multi-regional, fast-moving and legally layered. The same event may trigger a war risk clause, an insurance notice obligation, a safe port objection, a sanctions review, a deviation dispute and a disagreement over hire or demurrage. That is why war risk must be treated as a legal workflow, not merely an operational warning.
War Risk Premiums and the Economics of the Voyage
War risk premiums have become a core cost of modern voyage economics. They are no longer occasional surcharges to be discussed only in extreme cases. In certain trades, they may determine whether a fixture remains profitable at all. The difficulty is that premiums may change after the charterparty is concluded but before the vessel enters the relevant area. Underwriters may impose additional premium requirements, amend breach areas, restrict cover or require specific risk-mitigation measures. If the charterparty does not clearly allocate those costs, a commercial disagreement can quickly become a legal dispute.
The starting point is contractual wording. Some charterparties provide that charterers must reimburse owners for additional war risk premiums incurred as a result of charterers’ orders. Others are narrower, referring only to hull war risk additional premiums, leaving uncertainty over P&I war cover, loss of hire, kidnap and ransom, crew bonuses or security costs. Owners should not assume that every cost connected with war risk is automatically recoverable. Charterers, equally, should not assume that owners have priced unlimited geopolitical exposure into the freight or hire.
English law will examine the bargain actually made. If the clause requires reimbursement of “all additional war risk premiums”, the owner’s position is stronger, provided the premium is properly evidenced and causally connected to the charterers’ orders. If the clause is narrow or ambiguous, recovery may be more difficult. Supporting documentation from brokers or underwriters is therefore essential. A vague debit note or internal calculation may not be enough in a contested arbitration.
The Supreme Court decision in Herculito Maritime Ltd v Gunvor International BV (The Polar) [2024] UKSC 2 is a timely reminder that insurance and premium-allocation provisions must be read carefully. The case arose from a piracy incident and considered the relationship between charterparty terms, bills of lading, general average and insurance arrangements. One practical lesson is clear: the presence of insurance provisions does not automatically create a complete code for all consequences of the insured peril. Clear words are required if parties intend to shift or exclude liabilities that would otherwise arise.
P&I, Hull and Machinery, and War Exclusions
A common mistake is to speak of “war risk insurance” as though it were a single product. In reality, a shipowner’s insurance programme is layered. Ordinary Hull and Machinery insurance generally responds to physical loss of or damage to the vessel caused by insured marine perils, but war perils are commonly excluded and insured separately under hull war risk cover. P&I insurance protects against third-party liabilities such as cargo claims, crew injury, pollution, collision liabilities and wreck removal, but standard P&I rules typically contain war exclusions, subject to separate or excess war risk arrangements.
This distinction matters because a war-related incident may produce several types of loss at once. A missile strike may damage the hull, injure crew, delay cargo, cause pollution, trigger salvage, give rise to general average and create charterparty disputes. Different parts of the loss may fall under different insurance layers, and some may not be insured at all. Physical damage is one thing; loss of profit, missed employment, increased bunkers, reputational harm and delay claims are another.
Sanctions add another layer of difficulty. A claim may appear covered as a matter of policy wording, but payment may be restricted if insurers, banks or clubs are prevented from dealing with a sanctioned entity, cargo, port, trade or payment route. A vessel may complete a voyage without physical incident and still expose the owner to serious legal consequences if the trade is sanctions-sensitive. For that reason, war risk due diligence must include ownership, cargo, charterer, sub-charterer, receiver, port, payment chain and insurance analysis.
Detention is particularly problematic. A vessel may be held by authorities, blocked by military measures or trapped by closure of a waterway without suffering physical damage. The commercial consequences can be severe, but insurance recovery and charterparty allocation depend on precise wording. In The Saldana [2010] EWHC 1340 (Comm), a vessel seized by Somali pirates remained on hire under the relevant NYPE off-hire clause because the wording did not bring the seizure within the off-hire events relied upon. The case is a useful warning: if parties intend capture, seizure, detention, piracy or war-related delay to place the vessel off hire, they should say so expressly.
Rerouting, Employment Orders and Deviation
Rerouting is often presented as a practical safety decision, but legally it is much more than that. Under a time charter, charterers generally control the commercial employment of the vessel, including port nominations and, in many circumstances, routing instructions. Under a voyage charter, the owner has undertaken to perform a particular voyage, and deviation from the contractual route may expose the owner to claims unless justified by contract, necessity or recognised legal liberty. Bills of lading may further complicate the position if cargo interests allege delay or unauthorised deviation.
The House of Lords decision in The Hill Harmony [2001] 1 AC 638 remains important. Although it concerned weather routing rather than war risk, it clarified the distinction between navigation and employment under a time charter. Charterers’ routing instructions may be legitimate employment orders, provided they do not interfere with the master’s responsibility for safety and navigation. In war risk cases, this principle becomes delicate. A charterer may argue that the vessel must proceed by the usual commercial route. The owner may respond that the route exposes the ship, crew or cargo to a real war risk and that the charterparty permits refusal or alternative routing.
The Commercial Court decision in The Triton Lark [2012] EWHC 70 (Comm) is especially relevant. The case concerned the CONWARTIME 1993 clause and piracy risk in the Gulf of Aden. Teare J held that the phrase “may be exposed to War Risks” required more than a bare possibility; it required a real likelihood of exposure. This is a practical and balanced test. Owners do not have to wait until their own vessel is attacked, but they must rely on more than speculation or general nervousness. Intelligence reports, naval advisories, insurer notices, previous incidents, cargo sensitivity and vessel-specific factors may all be relevant.
The Court of Appeal’s decision in The Product Star (No 2) [1993] 1 Lloyd’s Rep 397 also remains significant. Where a contract gives owners discretion to refuse an order on war risk grounds, that discretion must be exercised honestly and rationally, not arbitrarily or capriciously. This protects both sides. Owners cannot use war risk as a convenient excuse to escape an unattractive fixture. Charterers cannot dismiss a properly evidenced safety concern merely because performance has become commercially inconvenient.
Safe Port and Safe Berth in a Hostile Environment
The safe port and safe berth undertaking is one of the most important legal tools in modern war risk disputes. Under English law, a port is not safe unless the particular vessel can reach it, use it and depart from it without being exposed to danger which cannot be avoided by good navigation and seamanship, in the absence of an abnormal occurrence. This classic formulation comes from The Eastern City [1958] 2 Lloyd’s Rep 127 and remains the foundation of the doctrine.
The concept of safety is not limited to physical characteristics such as depth, berth structure, tugs, swell or navigational hazards. A port may be unsafe because of political violence, war, blockade, mines, missile attacks, seizure risk, civil unrest or hostile state action. A terminal may have excellent infrastructure but still be unsafe if vessels calling there face a real and foreseeable risk of attack or detention. In this sense, modern war risk has expanded the practical importance of safe port warranties.
However, charterers are not insurers against every later event. The timing of nomination and the foreseeability of danger are critical. In The Evia (No 2) [1983] 1 AC 736, the vessel was ordered to Basrah before the outbreak of the Iran-Iraq war and later became trapped. The House of Lords held that the port had been prospectively safe when nominated and that the outbreak of war was an abnormal occurrence. The case does not mean that war can never render a port unsafe. It means that the court will examine whether the relevant danger was foreseeable, sufficiently connected with the port, and present at the time of nomination.
The Supreme Court decision in The Ocean Victory [2017] UKSC 35, although concerning weather conditions at Kashima rather than war, further illustrates the importance of abnormal occurrence. A combination of rare conditions may fall outside the safe port warranty. By analogy, a sudden and unforeseeable attack may be treated differently from a persistent, known and escalating pattern of hostile action. In modern conflict zones, the more regular and foreseeable the violence becomes, the harder it may be for charterers to characterise it as abnormal.
Owners raising a safe port objection must therefore be specific. It is not enough to say that a region is dangerous. The owner should identify the precise danger, the particular vessel’s exposure, the relevant port or berth, the timing of the nomination, the available intelligence and the contractual basis for refusal. A well-documented objection is far stronger than a general expression of concern.
Drafting for the New Normal
The most effective response to modern war risk is careful drafting before the fixture is concluded. War risk clauses should no longer be treated as boilerplate. The parties should expressly address whether owners may refuse to proceed to or through war risk areas, whether they may reroute, whether hire continues during rerouting or delay, who pays additional premiums, who pays for extra bunkers, whether crew bonuses and security expenses are recoverable, and what evidence is required to support the decision.
Safe port and safe berth wording should also be reviewed carefully. A named port does not always answer the question of risk allocation. If the parties intend charterers to bear the risk of political unsafety, the wording should make that clear. If charterers wish to avoid open-ended liability for unforeseeable escalation, they should draft accordingly. The same applies to off-hire clauses. If war, piracy, seizure, detention, blocking and trapping, or naval restrictions are to place the vessel off hire, they should be expressly included.
Insurance provisions must be aligned with charterparty obligations. It is commercially dangerous for a charterparty to require trading into an area where cover is unavailable, conditional or prohibitively expensive. It is equally dangerous for an owner to assume that additional premiums are recoverable without clear wording. Legal, insurance and operations teams should review exposed voyages together before fixture. Once the vessel is approaching the risk area, negotiation becomes pressure; before fixture, it is risk allocation.
Conclusion
War risk is no longer exceptional. It is part of the ordinary legal and commercial environment in which shipowners operate. The Red Sea, Hormuz, the Black Sea and the Eastern Mediterranean demonstrate that geopolitical danger can affect routing, insurance, hire, freight, safe port obligations, sanctions compliance and the economic foundation of a voyage. English law provides a sophisticated framework, but it requires careful evidence and precise drafting.
The practical lesson is simple. Owners should not rely on broad fear; they should build a documented, vessel-specific and contract-based assessment. Charterers should not assume that employment orders override genuine safety concerns. Insurers should not be treated as a substitute for contractual clarity. In the new normal, war risk is not merely a peril at sea. It is a legal allocation problem. The parties who recognise that before the fixture will be far better protected than those who argue about it after the casualty, detention or deviation has occurred.
Cases:
1. Leeds Shipping Co Ltd v Société Française Bunge (The Eastern City) [1958] 2 Lloyd’s Rep 127.
2. Kodros Shipping Corp v Empresa Cubana de Fletes (The Evia No 2) [1983] 1 AC 736.
3. The Product Star (No 2) [1993] 1 Lloyd’s Rep 397.
4. Whistler International Ltd v Kawasaki Kisen Kaisha Ltd (The Hill Harmony) [2001] 1 AC 638.
5. Masefield AG v Amlin Corporate Member Ltd [2011] EWCA Civ 24.
6. Pacific Basin IHX Ltd v Bulkhandling Handymax AS (The Triton Lark) [2012] EWHC 70 (Comm).
7. The Saldanha [2010] EWHC 1340 (Comm).
8. Gard Marine & Energy Ltd v China National Chartering Co Ltd (The Ocean Victory) [2017] UKSC 35.
9. Herculito Maritime Ltd v Gunvor International BV (The Polar) [2024] UKSC 2.