Introduction A reader asked whether an issuing bank may agree to amend a letter of credit by removing the phrase “irrespective of percentage” from the insurance requirement. Would such an amendment create any risk for the bank, particularly where the insurance policy or certificate is required to be endorsed in favour of the issuing bank? The answer lies in understanding …

One of the recurring issues in LC operations is how to handle insurance documents that contain both the phrase “irrespective of percentage” and a deductible clause. Traders often assume the “irrespective of percentage” wording will override the deductible, but under UCP 600 and ISBP 821, the story is different. Let’s look at a real case. __________ QUESTION Dear Mr. Old …