The Iran conflict and its consequences for maritime traffic through the Strait of Hormuz have laid bare structural weaknesses in global insurance markets that were present long before the first strikes. Within days of the outbreak of conflict in February 2026, war risk premium surged 500%, making transit economically unviable for most commercial operators.
The world’s 12 major protection and indemnity clubs, which collectively underwrite the majority of ocean-going vessels, moved rapidly to cancel war cover across the Gulf shortly after the conflict began. Private capacity withdrew at a pace that neither shipowners nor cargo interests had anticipated, exposing the degree to which the market had treated the disruption as a remote tail risk rather than a credible scenario requiring dedicated underwriting infrastructure.
The insurance sector had entered 2026 in robust financial health, with reinsurance capital at historically elevated levels following several consecutive years of strong underwriting returns. Risk capacity for geopolitically exposed lines had become heavily centralised in a small number of markets and institutions. When those institutions moved simultaneously, the gap they left was immediate and substantial for energy and logistics, as well as the global economy.
Governments As Insurers
In response, the US government directed its International Development Finance Corporation to partner with domestic insurers to establish a reinsurance facility covering tens of billions of dollars in hull, cargo and liability exposure in an effort to stabilise commercial shipping through the Strait of Hormuz. The precedent set by sovereign institutions stepping in to backstop private insurance markets during geopolitical disruption has structural implications for how risk capacity is organised and where it needs to be developed. Global specialty insurance – including marine, political risk and trade credit – is expected to triple by the mid-2030s as geopolitical events grow more frequent and complex in nature.
Strategic Positioning
Through the Qatar Financial Centre, the country has spent more than a decade attracting international insurers, reinsurers and captive insurance structures as part of a broader strategy to position Doha as a regional financial services hub. This ecosystem is anchored by Qatar Insurance Company (QIC), the largest insurer in the Middle East and North Africa, which has developed significant expertise across marine, energy and speciality insurance lines.
The concentration of underwriting, reinsurance and risk management capabilities gives Qatar a stronger platform than many regional peers to respond to growing demand for complex geopolitical and trade-related insurance products. This will be increasingly important given the ongoing geopolitical and security-related uncertainty in the region.
Meanwhile, the insurance sector in other countries like Turkey for example, enters this evolving environment with a combination of attributes that few emerging markets can match. With gross written premium exceeding $25bn, Turkey constitutes the largest insurance market in the arc between the Middle East and Europe, giving it the scale to attract the reinsurance partnerships and foreign capital that deepening its specialised lines capability would require.
The sector’s historical experience of foreign ownership demonstrates its capacity to integrate with international capital structures. Macroeconomic stabilisation has improved the conditions for renewed foreign engagement. Geographically, Turkey sits at the intersection of the trade corridors most directly affected by the Strait of Hormuz disruption.
Marine, cargo, political risk and trade credit are precisely those for which Turkey’s regional relationships in the Gulf provide a natural underwriting vantage point. By exposing the fragility of concentrated risk capacity, the geopolitical volatility in the Gulf has created both the demand and the incentive for a more geographically evenly distributed global insurance architecture.
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