Marine war risk insurers moved with unusual speed following the United States and Israeli military strikes on Iran, issuing cancellation notices for Gulf shipping policies before financial markets reopened on Monday, in a development that industry specialists say could prove more immediately disruptive to global trade flows than the crude oil price surge that dominated weekend headlines.
Marsh, the world’s largest insurance broker, estimates near-term hull and machinery rate increases of 25 to 50 percent for vessels transiting the Strait of Hormuz and the wider Gulf region. Before the strikes, war risk premiums for a Hormuz transit were priced at approximately 0.25 percent of a vessel’s insured hull and machinery value. Brokers now indicate premiums could reach 0.5 percent or higher, meaning a single-transit premium for a large container ship valued at $150 million would rise from approximately $375,000 to $750,000, costs passed directly to cargo owners as war risk surcharges.
The more consequential development may not be price escalation but selective uninsurability. Industry leaders at BIMCO have warned that vessels with business connections to the United States or Israel could face difficulty obtaining coverage at any price, creating a two-tier shipping market in which flag state and ownership links to parties in the conflict determine whether a vessel can legally and commercially sail through the Strait at all.
The Lloyd’s Market Association’s Joint War Committee was expected to update its listed areas designation imminently. That classification carries automatic legal consequences beyond the symbolic: once a region is formally listed, war risk clauses embedded in charter parties and insurance contracts activate automatically, resetting coverage terms across thousands of active voyages simultaneously.
Hapag-Lloyd, one of the world’s largest container lines, announced a War Risk Surcharge effective March 2, 2026, for all cargo moving to and from the Upper Gulf, Persian Gulf and Arabian Gulf, applicable immediately to any booking not yet shipped and to cargo already on the water but not yet discharged. Cargo war risk insurers, whose policies cover commodities including grain and oil carried on tankers, separately confirmed they were preparing to cancel existing Gulf policies on Monday pending renegotiation.
Lloyd’s List Intelligence Automatic Identification System data showed multiple vessels making U-turns in the Middle East Gulf and Gulf of Oman on Saturday, though others continued to transit the Strait of Hormuz. The primary risks identified by underwriters centre on vessel boarding and seizure by Iranian forces and the potential full closure of the Strait, a scenario still regarded as low-probability but high-impact.
Insurance costs for shipping in the region are expected to surge by up to 50 percent. For a vessel valued at $100 million, that translates to an increase from $250,000 to $375,000 per voyage, with cargo war risk insurers also preparing to cancel policies on Monday covering commodities carried on tankers including grain and oil.
The insurance disruption has direct implications for oil-importing economies across Africa and Asia that depend on Gulf-sourced crude and refined products. War risk surcharges are passed through the supply chain directly to cargo owners, meaning import-dependent nations will absorb higher freight costs on top of the crude price increase simultaneously, even if physical supply is not yet interrupted.
Physical supply disruption at this stage has not been confirmed, but freight markets are expected to react first and insurers will continue reassessing risk exposure in Middle East load zones as the conflict evolves, according to Claire Jungman, Director of Maritime Risk and Intelligence at Vortexa. The decisive variable remains whether Iran moves from missile and drone attacks on land targets toward active interdiction of commercial shipping in the Strait itself — a threshold that, if crossed, would trigger a far more severe and immediate repricing across every market that depends on Gulf energy flows.
