Glossary

General average

A maritime principle under which everyone with an interest in a voyage shares, in proportion to values saved, the cost of a sacrifice made to save the venture.

Also called: general average contribution, GA, general average declaration

General average is one of the oldest rules in maritime law. When the master deliberately sacrifices part of the venture, such as jettisoning cargo or flooding a hold, or incurs extraordinary expense, such as a tow into a port of refuge, to save the vessel and cargo from a common peril, the loss is shared by all parties in proportion to what each saved. Shipowner and cargo owners alike contribute, including those whose goods arrived undamaged.

Say a fire breaks out at sea and the crew jettisons $2 million of cargo to save a vessel and cargo worth $100 million (a hypothetical). Each interest owes roughly 2% of its value. A shipper whose $500,000 of goods arrived untouched owes about $10,000. Rules are commonly set by the York-Antwerp Rules, which bills of lading usually incorporate.

The practical bite comes at the port. The carrier can hold cargo until owners post security, usually a general average bond and a guarantee from their marine insurer. Without cargo coverage, a shipper may be unable to collect its goods or may pay the contribution out of pocket. Ocean cargo policies typically cover general average contributions, but terms vary, so confirm yours. The guide on general average: what it means for shippers and cargo owners covers the process, and ocean marine explains the cargo and hull coverages involved.

Last reviewed October 10, 2026

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Related terms

Ocean marine Insurance for ships, their cargo and the liabilities of shipowners and shippers at sea; one of the oldest forms of insurance and separate from inland marine. Inland marine Property coverage for goods in transit, movable equipment and certain specialty property, written outside the standard building and contents forms. Motor truck cargo Coverage for a trucker's legal liability when a customer's freight is lost, stolen or damaged while in the carrier's care during transport.

Related guides

General average: what it means for shippers and cargo owners General average makes every party on a sea voyage share emergency losses, even undamaged cargo. How a declaration works and how cargo insurance responds. Incoterms and who insures goods in transit Only CIF and CIP make the seller buy cargo insurance. Where risk passes under all 11 Incoterms rules, who should insure, and what to put in the contract. Ocean marine and cargo insurance: how shipment and vessel coverage works Marine cargo insurance covers goods door to door under the Institute Cargo Clauses. What A, B and C cover, why carrier liability falls short, how claims run.