War Insurance Premiums for Israel Surge Amid Escalating Conflict with Iran
According to a recent report from Reuters, Insurance costs for ships heading to Israel have soared sharply as tensions with Iran intensify, pushing war risk premiums up to three times higher than last week, according to global marine insurance experts.
Currently, the cost of war risk insurance for a seven-day voyage to Israeli ports is quoted between 0.7% and 1.0% of a vessel’s value—significantly higher than the 0.2% recorded just a week ago. Although the rate remains below the post-Hamas attack peak of over 2% in November 2023, it still translates to tens of thousands of dollars in additional daily costs for each voyage
David Smith from McGill and Partners noted that calls specifically directed at Israel are evaluated individually with rates potentially hitting up to 1% for a seven-day call based on various factors like cargo type and ownership details.
Israel, heavily reliant on maritime imports, continues to operate its key seaports in Ashdod – located near Gaza, Haifa in the north, and Eilat on the Red Sea Coast. Despite the tension, sources involved in Haifa port operations reported that all terminals remain fully functional. However, ship tracking data shows nearly 30 vessels anchored around Haifa Bay, reflecting growing caution among shipping companies.
Adding to the maritime risk is the Iran-backed Houthi militia in Yemen, which has publicly threatened to target Israel-linked vessels. Many shipping companies are already wary of sailing to Israel due to the higher risk profile.
In March, the group declared a maritime blockade on Haifa port in response to the conflict in Gaza, further complicating the regional security landscape.