Oslo-based marine insurance provider Skuld has cancelled war risk coverage in the Mideast Gulf and the Gulf of Oman because of a deteriorating geopolitical situation in the region.
The move comes as US and Israeli attacks on Iran prompted a military response from Tehran, raising risk to shipping moving in and out of the Gulf through the strait of Hormuz. A small chemical and oil products tanker was hit there earlier today, and Oman's Duqm port was struck by drones.
"It is already evident that reinsurers' appetite for war risk exposure is tightening, and in practical terms, it will result in reinsurers withdrawing capacity at short notice," Skuld said. "Against this backdrop, the Association [Skuld] has therefore decided to issue the Assureds with a notice of cancellation of the War Risk Cover."
The notice of cancellation will take effect in 72 hours, or at 00:00 GMT on 5 March, when the war risk cover will be terminated automatically.
This notice of cancellation supersedes any other terms with respect to war risks that may be agreed, it said. It applies to war risk cover only; all other terms of cover are unchanged. The notice does not alter the position of any other area currently restricted or excluded under respective policies. The notice does not affect mutual P&I and FD&D (freight, demurrage and defence) cover and the excess war risks cover afforded to Assureds with mutual P&I cover, according to Skuld.
