Ocean Freight Surcharges

WAR Surcharge (War Risk Surcharge)

WAR (War Risk Surcharge): Insurance surcharge for vessels transiting high-risk areas. When it applies, typical range, and who pays under common Incoterms.

Code: WAR
Name: War Risk Surcharge
Typical range: $50-$500+ per TEU depending on risk level
Routes: Routes through designated war risk zones

War Risk Surcharge (WAR or WRS) is charged when vessels transit waters designated as high-risk due to military conflicts, piracy, or geopolitical instability. The surcharge covers additional insurance premiums that carriers must pay for vessels and cargo in these areas.

High-risk areas historically include: • Gulf of Aden / Horn of Africa (piracy) • Persian Gulf / Strait of Hormuz • Red Sea / Bab el-Mandeb Strait • Black Sea (during conflicts) • South China Sea (disputed areas) • West Africa (piracy zones)

WAR surcharge covers: • Additional hull and machinery insurance • Crew war risk insurance • P&I (Protection & Indemnity) war extensions • Cargo war risk insurance • Security measures (armed guards, route deviations)

The surcharge can be imposed or increased with little notice when situations deteriorate, as seen during Houthi attacks on Red Sea shipping in 2024, which led to significant WAR surcharges and vessels diverting around Africa.

When WAR applies

When vessels transit designated high-risk waters.

Who pays WAR under common Incoterms

FOB: buyer
CIF: negotiable
EXW: buyer
DAP: seller

How to minimize WAR

Use alternative routing when available
Review cargo insurance coverage separately
Monitor geopolitical developments
Negotiate WAR caps in long-term contracts

Frequently asked questions

What is the WAR surcharge?

WAR stands for War Risk Surcharge. Insurance surcharge for vessels transiting high-risk areas.

When does WAR apply?

When vessels transit designated high-risk waters.

How much is WAR?

The typical range is $50-$500+ per TEU depending on risk level. Confirm the current amount with your carrier or forwarder.