Amid ongoing conflict in the Middle East, insurers have raised hull and machinery insurance premiums by 60% for vessels transiting the Strait of Hormuz since the start of the war between Israel and Iran as the conflict threatens shipping in a key choke point for crude oil, the Financial Times newspaper wrote War risk insurance premiums have also soared in the Red Sea.
This hike has pushed typical rates from 0.125% of a ship’s value up to 0.2% within just a few days. For a vessel valued at 100 million USD, the rate for an insurance policy has jumped from 125 000 USD to 200 000 USD.
This surge reflects the marine market’s concern that a wider regional escalation could disrupt already fragile shipping routes in the Gulf region.
“We’ve not yet seen a missile fired at a ship in the Arabian Gulf, so what it represents is the market saying, look, there’s definitely a heightened level of concern about the safety of shipping in the region,” Marcus Baker, global head of marine and cargo insurance at Marsh McLennan, told the Financial Time
Ships trying to pass through the strait face a range of dangers, from electronic interference to attacks by the Iran-backed Houthi group and the threat of further escalation by Israel and Iran, said brokers and insurers.
Dr Mahmoud Haiba marine Insurance Expert told ” Maritime Tickers ” : More insurance companies may be stop offering coverage due to the risks wheres others may see any downturn as an opportunity. “War itself”, as an insurance product. Adding: War risk insurance is an additional risk emphasizing that Many underwriters willing to take the risks have become enormously wealthy
Related :Fire on 3 ships in the Sea of Oman before the Strait of Hormuz
Source : Agencies
