State-owned reinsurer General Insurance Corporation of India (GIC Re) has amended its Marine Hull War Risk scheme, withdrawing cover in several high-risk global regions from early March 2026. According to reports from The Economic Times, the changes took effect from 7 pm India time Sunday, with the reinsurer ceasing to provide Marine Hull War risk cover in the specified zones from 7 pm on March 3 (Tuesday). In a notice issued on March 1, GIC Re confirmed the withdrawal would affect operations in the specified regions. The policy withdrawal comes as Iran-Israel tensions escalate with reports of Iranian rockets hitting Jerusalem and the IRGC HQ being destroyed, prompting US strikes on 1,000 Iranian targets. The escalation has now entered its second day with the Iranian Navy declaring the closure of the Strait of Hormuz, disallowing passage of ships from one of the busiest waterways in the world. As per The Economic Times, Hitesh Joshi, ED and additional charge of CMD at GIC Re, confirmed that the lead reinsurer usually sends out letters of termination or communicates any changes in the policy on behalf of all the reinsurance companies on the placement.
The revised High Risk Areas (HRA) include Pakistan waters, the Persian or Arabian Gulf and adjacent waters including the Gulf of Oman, Iran and all other countries under sanctions by the UN, UK, US or EU; and the Sea of Azov and parts of the Black Sea defined by specific geographical coordinates. As reported by The Economic Times, the list also covers waters of Ukraine, Russia and Belarus, as well as parts of the Indian Ocean, Gulf of Aden and Southern Red Sea. The withdrawal affects operations in these seven zones where war risk protection will no longer be available, particularly as about 25 vessels in the Persian Gulf region are being monitored in coordination with the Indian Navy. Domestic ports are offering additional holding space to stranded cargo which cannot reach West Asian destinations due to the ongoing conflict. According to The Economic Times, some hull policies have already been cancelled or repriced sharply higher after guidance circulated from the large insurance market, while cargo wordings remain under review.
GIC Re has made it clear that Breach of Warranty cover will not be available in respect of any of these seven zones, therefore, if a vessel passes through, calls at a port, or is dry-docked in any of the listed areas, it will be treated as a breach of warranty under the policy. According to The Economic Times, ship owners and operators will not have war risk protection from GIC Re for operations in these regions after the cut-off date. Major shipping companies have suspended bookings and rerouted vessels as a precautionary measure. Maersk has announced that all sailings on the Middle East-India to Mediterranean, and Middle East-India to East Coast US services will be rerouted around the Cape of Good Hope. CMA CGM has instructed vessels inside the Gulf and headed for the Gulf to proceed to shelter, with passage through the Suez Canal suspended until further notice. The government has specifically told Indian-flagged vessels to stay anchored at sea and avoid calling at West Asian ports. The Economic Times reports that shipping lines are already rerouting via the Cape of Good Hope, adding 15–20 days to voyages, increasing fuel costs and potentially triggering 'delay in startup' claims and higher hull and cargo premiums.
The withdrawal of cover comes amid elevated geopolitical tensions in parts of West Asia, the Black Sea region and the Red Sea, where shipping routes have faced heightened security risks in recent years. As reported by The Economic Times, ship owners operating international routes will now have to review their insurance arrangements carefully to ensure continued protection beyond March 3. The move aligns with the Directorate General of Shipping's fresh advisory to Indian-flag vessels amid rising tensions around Iran and the Strait of Hormuz, where ship owners have been asked to conduct risk assessments, security drills, test alert systems, and follow strict reporting protocols during transit. DP World has suspended operations at the Jebel Ali port in Dubai temporarily as a precautionary measure, while MSC Mediterranean Shipping Company has halted all bookings for worldwide cargo to the Middle East region until further notice. According to The Economic Times, trade credit insurers are likely to withdraw 'limit' approvals for companies trading in the region, fearing a wave of defaults caused by the sudden cessation of business operations.
Marine Hull War Risk insurance typically covers physical damage to ships arising from war, civil war, hostilities, terrorism, piracy and related perils. According to The Economic Times, the withdrawal of cover in these areas could raise insurance costs for ship owners operating in or near conflict-prone waters, as they may need to seek alternate cover at higher premiums. In 2022, GIC had amended the policy clause to include that while standard notice period is seven days, if the situation involves any of the five powers - China, France, Russia, the United Kingdom or the United States - the notice period reduces to 72 hours. Since the United States is involved in the current situation, the shorter 72-hour clause applies, with Brent crude closing at $72.48 per barrel and potential rise to $85–$90 amid the escalating tensions. Hari Radhakrishnan, Expert at Insurance Brokers Association of India (IBAI), noted that reinsurance renewal rates for marine hull war risk cover are expected to increase substantially, with maximum reinsurance renewals in India happening in April. According to The Economic Times, premiums are also likely to be revised due to disruption in the Strait of Hormuz, especially if cargo is forced to take a longer route, with freight rates set to rise again, with the extent of the increase depending on how long and how severely the disruption persists.
