Article 28 — Insurance Documents: Insurance Policy vs. Insurance Certificate

Introduction

UCP 600 Article 28 governs insurance documents presented under documentary credits. The distinction between an insurance policy and an insurance certificate has historical significance but has been simplified under UCP 600. This guide examines the regulatory framework, failure scenarios, and resolution process for insurance document types.

Failure Mode Analysis

Failure 1: Credit Requires an Insurance Policy But Certificate Is Presented

While Article 28(b) allows interchangeability, the credit may specifically require a "policy" for legal or regulatory reasons. If the credit requires a policy, the bank must assess whether a certificate satisfies the requirement.

Failure 2: Insurance Document Is Not Issued or Signed by the Insurer

The insurance document is presented without the insurer's signature. Article 28(c) requires the document to be issued or signed by the insurer.

Failure 3: Insurance Certificate References a Different Policy

The insurance certificate references a policy number that does not match the underlying coverage. The examining bank cannot verify the coverage.

Failure 4: Insurance Document Is an Open Cover Declaration Without the Required Details

The beneficiary presents a declaration under an open cover but the declaration does not contain all the required information (insured amount, description of goods, voyage details).

Deterministic Resolution Architecture

Step 1: Determine the Credit's Insurance Document Requirement

Review the credit to determine whether it requires a policy, certificate, or other insurance document.

Step 2: Verify the Insurance Document Type

Under Article 28(b), a policy and certificate are interchangeable. However, verify that the presented document meets the credit's requirements.

Step 3: Verify the Insurer's Signature

Confirm that the insurance document bears the insurer's signature or that of their agent, as required by Article 28(c).

Step 4: Verify Coverage Details

Check that the insurance document covers the goods, voyage, and amount required by the credit.

Step 5: Issue a Discrepancy Notice

If the insurance document fails any Article 28 requirement, issue a refusal notice under Article 16.

Step 6: Request a Corrected Insurance Document

The beneficiary must obtain a corrected insurance document from the insurer.

Step 7: Verify and Resubmit

The examining bank verifies the corrected insurance document and confirms compliance.

Conclusion

Under UCP 600, the distinction between an insurance policy and an insurance certificate has been eliminated. Both are acceptable interchangeably. However, the insurance document must still meet the requirements of Article 28, including insurer signature, adequate coverage, and proper currency and amount.

FAQ

Can a bank refuse an insurance certificate when the credit requires a policy?

Under Article 28(b), a certificate and policy are interchangeable. The bank should not refuse solely on the basis of the document type. However, if the credit expressly requires a policy for legal reasons, the bank may require a policy.

Does an insurance certificate provide the same coverage as a policy?

Yes. An insurance certificate confirms that the insured is covered under the underlying policy. The coverage is the same.

What if the insurance document is an open cover declaration?

An open cover declaration is acceptable under Article 28(a). The declaration must contain all required information (insured amount, goods description, voyage details).

Can the insurance document be issued by a broker?

Article 28(c) requires the document to be issued or signed by the insurer, underwriter, or their agents. A broker is not an insurer unless acting as the insurer's agent.

Does the insurance document need to be original?

Yes. Unless the credit permits copies, the insurance document must be an original under Article 17.

Source Notes

Context only. The source dossier returned the following sources for this topic. The underlying query was: "article 28 insurance documents insurance policy multi-family documentary credit site:iccwbo.org"

• Incoterms® 2020 — ICC (Published 29 Mar 2023)

• Context: Incoterms rules such as CIF and CIP require the seller to obtain insurance. The type of insurance document (policy or certificate) may be specified in the credit.

• Uniform Rules for Documentary Credits (UCP 600) - eBook — ICC Academy (Published 12 Dec 2024)

• Context: The UCP 600 text provides the primary source for insurance document requirements under Article 28.

• UCP 600 - Including eUCP Version 2.1 — ICC (Published 31 Jul 2023)

• Context: The full text of UCP 600 and eUCP 2.1 establishes the insurance document type requirements.

• Certified UCP 600 Specialist (CUCP) — ICC Academy (Published 12 Jul 2025)

• Context: The CUCP certification covers insurance document requirements as a core competency area.

• Incoterms® 2020 Checklist and Flowcharts — ICC Digital Library (Published 06 Feb 2025)

• Context: The Incoterms checklists include insurance verification steps, confirming that the insurance document type meets the agreed Incoterms requirements.