Fast exploration trades HP for speed for every ship in your civ. Changing it out for a different policy has historically brought all the ships back up to full HP on the next turn. Currently (1.96), swapping out the policy just raises the max HP of all the ships to normal, but keeps them at their previous lower actual HP. In other words, every ship in the civ is suddenly on fire, and has to slowly repair.
I guess it takes a while to retrofit your ships and GC 4 has no way of showing that except as damaged ships.
I also find interesting, is when a flag ship levels. If the ship is at full hit points when it levels the new hit points are added and the ship is at max full 'new' hit points. But if the ship is damaged when it levels, the max possible hit points is raised to the new level, but the ship stays at the previous damaged number of hit points.
I would think the behavior would be both one way (add the net new hit point always) or another (never add to the current level of hit points but just raise the max and let them repair to full).
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