The granting of war cover for the Persian Gulf and Red Sea is and will remain available under specific agreement on a single voyage basis as long as navigation is authorised by governments and flag states, said the International Union of Marine Insurers (IUMI) in an official statement released yesterday.
"In the current fast-paced situation, insurers will regularly re-examine their ability and willingness to that provide cover," the statement continued.
IUMI and the marine insurance community are closely monitoring the situation in the Middle East and, in particular, the safety and free passage of shipping in the Persian Gulf and Red Sea. As with all shipping interests, the safety of seafarers will be a priority for owners.
"The situation remains fluid with a number of vessels being trapped in the Persian Gulf and many operators re-routing their vessels to avoid the high-risk areas. Insurers will be mindful of the impact this might have on accumulations at nearby ports as well as on the vessels and crews as they navigate longer sea routes. We are likely to see disruptions to supply chains in the short-term, as a result," the union said.
The statement added that in circumstances such as these, some insurers will serve a Notice of Cancellation in relation to the cover their assureds have in place. This is to enable the insurer to reassess the risk and then reinstate the cover at adjusted terms. It is important to recognise that a Notice of Cancellation does not, necessarily, end the cover. War cover remains available for owners and operators wishing to take it.
It should be noted that IUMI members (in the main) provide property insurance (hull, machinery and cargo) whereas liability insurance is usually covered by Protection & Indemnity Clubs, many of whom operate under the umbrella of the International Group of P&I Clubs.
Similarly, Gallagher has confirmed that it continues to provide marine war risk insurance amid heightened tensions in the Persian Gulf. Gallagher’s Marine Divisional Director, Angus Blayney, said that both existing and new clients have access to coverage through Lloyd’s for vessels in the region.
“This availability applies to vessels currently in the Persian Gulf, as well as those planning to enter or exit via the Strait of Hormuz,” Mr Blayney said. “Over the past few days, Gallagher has secured marine war risk solutions for numerous clients, including those whose current brokers have struggled to find coverage,” he added.
Mr Blayney noted that insurance rates have risen due to the challenging maritime security environment, resulting in higher premiums. Despite this, marine insurers continue to provide coverage, ensuring that vital marine commerce remains uninterrupted.
He added that clients navigating this fast-moving situation benefit from working with a firm experienced in marine markets. “Gallagher is a partner with unparalleled access to the market and can deliver the best insurance solutions for clients seeking marine war risk coverage,” he said.