Marsh, Aon in Talks With US on Insuring Tankers in Hormuz

Major global insurance brokers Marsh & McLennan Companies and Aon plc are in discussions with the United States government and industry stakeholders about plans to provide insurance coverage for commercial tankers transiting the Strait of Hormuz, a critical chokepoint in global energy supply that has become increasingly volatile amid regional tensions. The talks underscore the unprecedented risks faced by shipping companies and insurers as geopolitical instability disrupts one of the world’s most important maritime routes.
The Strait of Hormuz, which links the Persian Gulf to the Arabian Sea and beyond, is vital to global energy markets. A significant portion of the world’s crude oil and liquefied natural gas (LNG) — estimates vary but often exceed 20% of total seaborne oil shipments — is exported through this narrow waterway. In recent months, hostilities involving Iran’s Revolutionary Guard Corps, U.S. and allied forces, and proxy groups have heightened concerns about potential attacks on vessels, prompting carriers and insurers to reassess risk exposures.
A Surge in Risk and Insurance Challenges
Historically, tanker insurance for routes through the Gulf has been priced to reflect relatively stable conditions, though always with a premium for geopolitical risk. Insurers typically rely on a combination of war risk cover, hull and machinery insurance, and protection & indemnity (P&I) liability coverage to manage potential losses. However, the recent uptick in near‑miss incidents, drone and missile threats, and contested airspace advisories has elevated the perceived threat level, leading some insurers to impose higher premiums or exclude certain risks altogether.
As a result, shipowners have encountered difficulty securing affordable, comprehensive coverage — particularly war risk insurance, which covers damage from conflict‑related events such as missile strikes or attacks by military forces. Without such coverage, vessels face prohibitive financial exposure. Some shipping lines have already rerouted vessels to avoid the Gulf, increasing voyage times and fuel costs, while others have continued transits unwilling or unable to accept limited insurance terms.
In this environment, Marsh and Aon have held preliminary talks with the U.S. government and private sector partners about potential mechanisms to ensure that commercial traffic can continue to flow with adequate protection for shipowners and crew. Officials have stressed that these discussions are exploratory and have not been formalised into any specific programme.
Government Involvement and Strategic Considerations
U.S. officials acknowledge the critical importance of maintaining open shipping lanes through the Strait of Hormuz, not only for energy markets but also for broader economic stability. A senior U.S. official involved in the talks noted that “ensuring that insurers and shipowners have confidence in transiting these waters is a strategic priority.” However, the official emphasised that any government‑backed measures would need to balance risk exposure, fiscal responsibility, and regulatory frameworks.
One proposal under consideration involves a public‑private partnership (PPP) in which the U.S. government could act as a backstop or reinsurer for specific risk layers, similar in concept to existing terrorism risk insurance programmes that provide limited government guarantees when private markets withdraw from high‑risk segments. Such arrangements aim to leverage private capital while providing an additional layer of security to mobilise market participation.
Market Response and Expert Opinion
Reactions from the insurance and shipping sectors have been mixed. Some industry analysts view government involvement as essential to preventing a de‑facto closure of the Gulf to commercial tankers, especially if war risk premiums continue to spike. “Without reasonable insurance solutions, carriers will be forced to avoid the route, driving up global energy prices and disrupting supply chains,” said a maritime risk consultant.
Others caution that government backstops carry their own challenges, including moral hazard — where firms take on greater risk because losses are partially borne by the public sector — and the complexities of valuation and claims settlement in conflict zones. They also note that the increasingly globalised nature of insurance capital means that unilateral programmes may have limited effect unless coordinated internationally.
Impact on Oil and Gas Markets
The broader energy market is already reacting to the uncertainty. Oil prices have experienced heightened volatility as traders factor in increased shipping risk, while consumers and refiners monitor freight cost fluctuations. For nations reliant on Gulf oil and LNG imports, particularly in Europe and Asia, extended disruption or sharply higher shipping costs could reverberate through domestic energy markets.
Some analysts suggest that the talks between Marsh, Aon, and the U.S. could signal a tipping point in how insurers and governments approach geopolitical risk in key maritime corridors. The potential for official involvement reflects the recognition that private markets alone may be insufficient to underwrite extreme tail risks in a sustained period of instability.
Looking Ahead
As negotiations continue, stakeholders are weighing a range of options — from temporary relief measures to longer‑term risk financing facilities. The urgency of the situation has accelerated discussions, but officials and industry representatives caution that any programme would require careful design, legal clarity, and international cooperation.
For now, shipowners, insurers, and governments will watch developments closely, aware that the outcome could shape maritime insurance norms and energy trade patterns for years to come. Ensuring the continued flow of tankers through the Strait of Hormuz remains a priority, but achieving stable, affordable insurance cover in a volatile geopolitical environment poses one of the most complex challenges facing the global maritime community today.