Multiple insurance companies notified shipowners on Feb. 28 that they would cancel policies for vessels transiting the Persian Gulf and Strait of Hormuz following joint US-Israeli strikes on Iran, while premiums are expected to surge by up to 50%.
According to the Financial Times, Dylan Mortimer, marine hull war leader at insurance brokerage Marsh, said vessels previously traveling through the Persian Gulf and Strait of Hormuz paid premiums of 0.25% of hull value, while ships calling at Israeli ports paid 0.1%. In the days following the military escalation, premiums for both categories could rise by up to 50% as underwriters calculate risks, including potential Iranian retaliation and possible closure of the Strait of Hormuz.
A leading cargo insurance broker also confirmed preparations to cancel policies on March 2, describing the move as a renegotiation tactic to secure higher premiums rather than an outright withdrawal of coverage.
Although the Strait of Hormuz handles approximately 20% of global seaborne oil trade, numerous vessels are choosing to avoid the conflict zone. At least three ships scheduled to transit the waterway on Feb. 28 altered course to avoid being caught in the hostilities.
Consultancy EOS Risk Group reported that some vessels received radio warnings, allegedly from Iran's Revolutionary Guard Corps, stating the strait was closed and banning maritime transit.
(Source: Wen Wei Po)
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