US, UK ship investors slapped by soaring Red Sea insurance
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According to two insurance industry sources, ships having ties to the US, the UK, or "Israel" would be quoted a higher rate, perhaps exceeding 50%.
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This photo provided by the Indian Navy shows the US-owned ship Genco Picardy that came under attack Wednesday from a bomb-carrying drone launched by the Yemeni Armed Forces in the Gulf of Aden, on Thursday, Jan. 18, 2024. (Indian Navy via AP)
War insurers have increased premiums charged to US, British, and Israeli corporations by up to 50% for ships crossing the Red Sea, and other providers are avoiding such business owing to Yemen's Armed Forces targeting the vessels, sources told Reuters.
David Smith, head of hull and marine liabilities at insurance broker McGill and Partners, revealed that ships with links to the US, Britain, or "Israel" are now paying 25-50% more in war risk premiums than other ships navigating the Red Sea.
According to two insurance industry sources, ships having ties to the United States, the United Kingdom, or "Israel" would be quoted a higher rate, perhaps exceeding 50%.
Marcus Baker, global head of marine and cargo with insurance broker Marsh, told Reuters that almost all ships that have faced some trouble had "some element of Israeli or US or UK ownership," citing that there was now some "exclusionary language" being introduced to cover such interests.
According to insurance industry sources, war risk premiums quoted for Red Sea cruises have hovered at 1% of the ship's worth in the last 10 days, up from roughly 0.7% prior with different discounts given by underwriters, meaning hundreds of thousands of dollars in added fees for a seven-day cruise.
Ships are also adding notes to their public ship tracking profiles, suggesting that they have no ties to UK, US, or Israeli enterprises, according to shipping statistics.
Dryad Global, a British marine risk advice and security firm, has recommended its clients avoid the region until further notice.
CEO Corey Ranslem expressed surprise that US and UK-flagged ships are still transiting through the Gulf of Aden since they are the most at risk.
Brigadier General Yahya Saree, the spokesperson of the Yemeni Armed Forces, announced Tuesday that Yemen's Naval Forces have conducted two military operations in the Red Sea targeting ships belonging to the US and UK.
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According to the spokesperson, the first operation targeted the US ship Star Nasia, while the other one targeted the British Morning Tide using "suitable naval missiles," stressing that "strikes were direct and accurate."
The US Central Command (CENTCOM) mentioned that six missiles were fired from Yemen toward two merchant ships on Tuesday, reportedly causing light damage to one of the vessels.
Saree also announced the intention of the Yemeni Armed Forces to carry out additional military operations against US and British targets in the Arabian and Red Seas, asserting their right to respond to aggression and defend Yemen and its people.
Moreover, the spokesperson reiterated the Yemeni Armed Forces' commitment to pursue military operations in the Red Sea, specifically targeting Israeli shipping and vessels en route to occupied Palestinian ports, vowing that these actions would continue until the siege on Gaza is lifted and the aggression against the Palestinian people in the Gaza Strip ceases.
