Latest news with #McGillAndPartners
Telegraph
22-07-2025
- Business
- Telegraph
Cargo ships told to carry more guns when sailing past Iran
Oil tankers sailing past Iran have been told by London insurers to carry more guns and ammunition and employ more security staff. Ships moving through the Strait of Hormuz, a maritime choke point between Dubai and Iran, are facing far higher insurance costs to cover the risk of navigating the waterway amid simmering tensions between Iran, the US and Israel. As part of 'war risk insurance' some underwriters are stipulating that vessels carry a certain quantity of ammunition alongside armed guards. Others are offering discounts based on the level of security on a vessel. David Smith, of broker McGill and Partners, said: 'We have seen war insurance for specific regions where they offer discounted premiums when armed guards are on board, and in certain circumstances, insurers even stipulate the minimum quantity of ammunition supplied to those armed guards and the number of armed guards – in order to fight off a potential boarding.' The Strait of Hormuz is one of the world's largest shipping routes for oil and gas supertankers, with around 20pc of global oil supply travelling through the waterway. Risks in the region have mounted in the past few months, with Houthi rebels in Yemen threatening ships sailing into the Red Sea, which sits on the other side of the Arabian Peninsula. Impact on London insurance London's insurers were left on the hook for a $40m (£30m) loss last month after the Magic Seas cargo ship vessel was blown up by Houthi militants using drones and rocket-propelled grenades in the Red Sea. Two crew members were killed. The Strait of Hormuz, which is 1,000 miles overland from the Red Sea, is largely protected from Houthi missile attacks. The risks in the Strait come from Iranian authorities impounding ships, blocking the waterway, as well as naval mines or missile strikes from Iran. In a recent bulletin, the joint war committee of the Lloyd's Market Association, an insurance marketplace, warned that 'ship owners have reported a heightened level of harassment when transiting' the Strait as tensions in the Middle East escalate. 'If you're trying to get war risk insurance in the Strait of Hormuz, it's going up dramatically. You can get coverage, but it's a lot more expensive than a year ago. It's available selectively – some coverage is being written and some isn't. If someone needs it, we could handle it', said Steve McGill, a veteran insurer who founded McGill and Partners in 2019. Some ships, particularly those that have recently docked in Israel or carry certain targeted flags, are even struggling to buy insurance altogether because of the risk of being attacked. Marine war risk insurance is one of the biggest types of policy classes written at Lloyd's of London, the UK's insurance market. Insurers such as Beazley, Navium Marine and Travelers are the big names in the market. Mr McGill said the ability of London's insurance market to deal with complex issues like the Strait of Hormuz showed it was the 'jewel in the crown' of Britain's financial services industry. 'London's insurance market is a phenomenal example of Britain at its best. It's an extraordinary marketplace, and it's a great success story. It's still the best in the world', he said.
Zawya
23-06-2025
- Business
- Zawya
Escalating Hormuz tensions drive up Middle East war risk insurance costs, sources say
LONDON: U.S. and Israeli attacks on Iran and Tehran's reprisals have doubled the price of insuring shipments to the Middle East and the Gulf in the last week, insurance sources said on Monday. War risk insurance premiums for shipments to the Middle East Gulf have jumped to 0.5% from around 0.2-0.3% a week ago, as risks grow to the critical Strait of Hormuz, the sources said. The cost of a seven-day voyage is based on the value of the ship and the increase will add tens of thousands of dollars each day in additional costs. While underwriters typically price risk and rates individually, the current 0.5% level reflected rates on Monday, the sources told Reuters and The Insurer, a Reuters publication. "The position (on rates) is subject to constant change," said David Smith, head of marine with insurance broker McGill and Partners. Iran carried out a missile attack on a U.S. airbase in Qatar on Monday after the U.S. bombed Iranian nuclear sites at the weekend. The conflict has raised concerns Iran could close Hormuz, the strait between Iran and Oman through which around 20% of global oil and gas demand flows. That has spurred forecasts of oil surging to $100 a barrel. Shipping rates for supertankers, which can carry 2 million barrels of oil, have also soared, more than doubling in a week to over $60,000 a day, freight data shows. War risk rates have hovered around the 0.3% level in the Gulf for many months. Rates in the Red Sea area spiked to 1% in 2024 after Iran-backed Houthis launched attacks on commercial ships which they said were in solidarity with Palestinians fighting Israel in Gaza. War risk rates for Israeli ports have soared in recent days, quoted as much as 1%. London's marine insurance market opted on June 18 not to widen waters around the Gulf deemed high risk, which is closely watched by underwriters. "The listed areas have been left unchanged as ships calling or transiting most of the Middle East already have to notify underwriters, who can then assess such voyages on their merits," said Neil Roberts, secretary of the Joint War Committee, which comprises syndicate members from the Lloyd's Market Association and representatives from the London insurance company market. (Reporting by Jonathan Saul with Reuters and Michael Jones with The Insurer; Editing by Nia Williams and Rosalba O'Brien)
Reuters
23-06-2025
- Business
- Reuters
Escalating Hormuz tensions drive up Middle East war risk insurance costs, sources say
LONDON, June 23 (Reuters) - U.S. and Israeli attacks on Iran and Tehran's reprisals have doubled the price of insuring shipments to the Middle East and the Gulf in the last week, insurance sources said on Monday. War risk insurance premiums for shipments to the Middle East Gulf have jumped to 0.5% from around 0.2-0.3% a week ago, as risks grow to the critical Strait of Hormuz, the sources said. The cost of a seven-day voyage is based on the value of the ship and the increase will add tens of thousands of dollars each day in additional costs. While underwriters typically price risk and rates individually, the current 0.5% level reflected rates on Monday, the sources told Reuters and The Insurer, a Reuters publication. "The position (on rates) is subject to constant change," said David Smith, head of marine with insurance broker McGill and Partners. Iran carried out a missile attack on a U.S. airbase in Qatar on Monday after the U.S. bombed Iranian nuclear sites at the weekend. The conflict has raised concerns Iran could close Hormuz, the strait between Iran and Oman through which around 20% of global oil and gas demand flows. That has spurred forecasts of oil surging to $100 a barrel. Shipping rates for supertankers, which can carry 2 million barrels of oil, have also soared, more than doubling in a week to over $60,000 a day, freight data shows. War risk rates have hovered around the 0.3% level in the Gulf for many months. Rates in the Red Sea area spiked to 1% in 2024 after Iran-backed Houthis launched attacks on commercial ships which they said were in solidarity with Palestinians fighting Israel in Gaza. War risk rates for Israeli ports have soared in recent days, quoted as much as 1%. London's marine insurance market opted on June 18 not to widen waters around the Gulf deemed high risk, which is closely watched by underwriters. "The listed areas have been left unchanged as ships calling or transiting most of the Middle East already have to notify underwriters, who can then assess such voyages on their merits," said Neil Roberts, secretary of the Joint War Committee, which comprises syndicate members from the Lloyd's Market Association and representatives from the London insurance company market.
Reuters
17-06-2025
- Business
- Reuters
War insurance costs to Israel soar after Iranian attacks, sources say
LONDON, June 17 (Reuters) - War risk insurance premiums for shipments to Israel are as much as three times higher than a week ago as the war between Israel and Iran entered its fifth day, industry sources said on Tuesday. The cost of a seven-day voyage to Israeli ports was quoted between 0.7% and 1.0% of the value of a ship, versus around 0.2% a week ago, they said. War risk premiums to Israel are still below a peak of over 2% in November 2023 that were quoted after a Hamas attack on Israel killed 1,200 people and triggered the Israeli invasion of Gaza. Individual underwriters will price risk and rates differently, but this will add tens of thousands of dollars of extra daily costs for every voyage. "Calls specifically to Israel are very much on a case-by-case basis with rates increased to anywhere up to 1% for a 7-day call, dependent on what cargo, ownership and port," David Smith, head of marine with insurance broker McGill and Partners, told Reuters. Israel relies on sea lanes for much of its imports which are shipped to gateways that include the Mediterranean ports of Ashdod, which is close to Gaza in the south, and Haifa in the north, as well as the Red Sea port of Eilat. Israel's Bazan Group shut down its Haifa oil refinery, the country's largest, on June 16 after its power station was damaged in an Iranian attack. Nearly 30 vessels, many general cargo ships, were currently anchored around Haifa's bay, according to MarineTraffic ship tracking data on Tuesday. All port terminals in Haifa were operating normally and remained fully operational, an Israeli source involved in Haifa's port industry said. Many shipping companies are already wary of sailing to Israel due to the higher risk profile. Yemen's Iran-backed Houthis have said they will attack any Israel-linked vessels despite reaching a ceasefire over U.S. and UK-linked ships in the Red Sea. The militia announced in March a "maritime blockade" on Haifa port in response to Israel's ongoing conflict in Gaza.
