Navigating Uncertainty: Marine Insurers Withdraw War Risk Cover Amid Middle East Tensions
Several marine insurers are cancelling war risk cover for ships due to growing tensions in the Middle East, especially in Iran and the Gulf. The cancellations affect key trade routes, with significant disruptions in oil and gas shipping. Efforts for coverage buy-backs are underway amidst escalating risks.
Marine insurers, including Gard, Skuld, NorthStandard, the London P&I Club, and the American Club, have announced the cancellation of war risk cover for vessels operating in Iranian and Gulf waters due to escalating regional conflicts. This decision is effective from March 5, according to online notices dated March 1.
In response to the increased tensions following U.S. and Israeli military operations in Iran, insurers have opted to exclude war risk coverage in critical areas of the Middle East. This move has led to significant disruptions, with key shipping routes, notably the Strait of Hormuz, being affected as tanker companies hold back shipments.
Data shows mounting logistical challenges, with over 150 tankers, including crude and LNG carriers, now anchored in the Gulf's open waters. This development follows damage to three tankers and the loss of a seafarer's life off the Gulf coast, signaling heightened risks in a critical global trade artery.
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