Red Sea insurance costs soar as Houthi shipping threats loom, sources say
War premiums for Red Sea voyage more than doubled since September, sources say
Houthis' attacks on vessels increase risks and costs for shipping
Smaller insurers are pausing Red Sea war coverage due to heightened risks, sources say
By Jonathan Saul and Carolyn Cohn
LONDON, Sept 19 (Reuters) -The cost of insuring a ship through the Red Sea has more than doubled since the start of September and some underwriters are pausing cover as the risk of attack from Yemen's Houthis on commercial vessels increases, industry sources said.
The Iran-backed Houthis first launched aerial drone and missile strikes on the waterway in November. They say they are acting in solidarity with Palestinians under assault in Israel's war on Gaza. In more than 70 attacks, the Houthis have sunk two vessels, seized another and killed at least three seafarers.
The industry sources, speaking on condition of anonymity, said additional war risk premiums, paid when vessels sail through the Red Sea, were quoted up to 2% of the value of vessel from 0.7% at the start of September and after the attack on the Greek operated Sounion tanker, which was on fire for weeks.
"Currently, we are seeing premiums as high as 2% on vessel value for a single Red Sea transit amid fluctuating insurer appetite," said Louise Nevill, UK CEO, marine, cargo & logistics, with broker Marsh.
The Houthis have said they will attack ships with links to the UK, the United States or have called at Israeli ports, although other vessels have been in the firing line, adding to dangers and also the costs involved.
"A lot of the smaller insurers are no longer prepared to underwrite Red Sea war coverage," said David Smith, head of marine with insurance broker McGill and Partners.
"It’s the first time I've seen underwriters just say no."
Insurance industry sources said there was still some cover available but the costs were rising.
"There is a lot of selection by those still willing to write ships," an underwriting source said, suggesting insurers were becoming increasingly cautious and selective. "Ships that are probable targets for attack are now struggling to find cover."
The Sounion, which was struck on Aug. 21 and laden with about one million barrels of crude oil, was towed without any oil spill, the EU naval mission said on Monday.
There have been no claims so far on the Sounion, with the vessel's value estimated at $80 million, three sources said.
They added that the war insurance policy was provided by a consortium led by underwriter Brit. The consortium of underwriters also included Antares, Iquw, Hamilton, Westfield and Aspen.
Aspen and Brit, a unit of Canadian insurer Fairfax, both declined to comment. Antares, Iquw, Hamilton and Westfield did not respond to a request for comment.
Editing by William Maclean
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Penafian: Entiti XM Group menyediakan perkhidmatan pelaksanaan sahaja dan akses ke Kemudahan Dagangan Atas Talian, yang membolehkan sesorang melihat dan/atau menggunakan kandungan yang ada di dalam atau melalui laman web, tidak bertujuan untuk mengubah atau memperluas, juga tidak mengubah atau mengembangkannya. Akses dan penggunaan tersebut tertakluk kepada: (i) Terma dan Syarat; (ii) Amaran Risiko; dan Penafian Penuh. Oleh itu, kandungan sedemikian disediakan tidak lebih dari sekadar maklumat umum. Terutamanya, perlu diketahui bahawa kandungan Kemudahan Dagangan Atas Talian bukan permintaan, atau tawaran untuk melakukan transaksi dalam pasaran kewangan. Berdagang dalam mana-mana pasaran kewangan melibatkan tahap risiko yang besar terhadap modal anda.
Semua bahan yang diterbitkan di Kemudahan Dagangan Atas Talian kami bertujuan hanya untuk tujuan pendidikan/maklumat dan tidak mengandungi – dan tidak boleh dianggap mengandungi nasihat kewangan, cukai pelaburan atau dagangan dan cadangan, atau rekod harga dagangan kami, atau tawaran, atau permintaan untuk suatu transaksi dalam sebarang instrumen kewangan atau promosi kewangan yang tidak diminta kepada anda.
Sebarang kandungan pihak ketiga serta kandungan yang disediakan oleh XM, seperti pendapat, berita, penyelidikan, analisis, harga, maklumat lain atau pautan ke laman web pihak ketiga yang terdapat dalam laman web ini disediakan berdasarkan "seadanya" sebagai ulasan pasaran umum dan bukanlah nasihat pelaburan. Sesuai dengan apa-apa kandungan yang ditafsir sebagai penyelidikan pelaburan, anda mestilah ambil perhatian dan menerima bahawa kandungan tersebut tidak bertujuan dan tidak sediakan berdasarkan keperluan undang-undang yang direka untuk mempromosikan penyelidikan pelaburan bebas dan oleh itu, ia dianggap sebagai komunikasi pemasaran di bawah peraturan dan undang-undang yang berkaitan. SIla pastikan bahawa anda telah membaca dan memahami Notifikasi mengenai Penyelidikan Pelaburan Bukan Bebas dan Amaran Risiko mengenai maklumat di atas yang boleh diakses di sini.
