Insurance news

Two earthquakes hit northern Venezuela on Wednesday evening within 39 seconds of each other – a 7.2 magnitude foreshock at 6:04pm local time, then a 7.5 magnitude mainshock. At least 920 people are now confirmed dead and 3,360 injured, National Assembly President Jorge Rodríguez said in a Friday briefing. Both figures are expected to climb. Buildings collapsed across Caracas, La Guaira and Carabobo. Simón Bolívar International Airport was damaged and shut. The USGS puts a 44% probability on the final death toll exceeding 10,000.

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The Strait of Hormuz has been closed, mined, contested and partially reopened since February. War risk premiums surged from 0.125% of hull value to as high as 10% for the most exposed vessels – an 80-fold increase that generated headlines about a London marine war market finally getting what it deserved after years of soft conditions. The reality, four months on, is more complicated. The market has absorbed losses, written less business than the rate headlines imply, navigated a government intervention that solved the wrong problem, and is now pricing for a recovery that may or may not hold through a 60-day ceasefire window that expires in mid-August. Whether any of this adds up to profit depends on which part of the market you are in, and whether the next six weeks produce incidents or incidents produce further mines. 

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Chris Bose, director of general insurance and international at the ABI, told the committee insurers paid close to £12 billion in motor claims in 2024, alongside £6.1 billion in property claims and £500 million in travel claims. Graeme Trudgill, chief executive of BIBA, said the association’s approximately 1,800 member firms place around £150 billion of premium annually, with brokers handling roughly a third of the personal lines market.

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Peggy Brinkman, a principal actuary at Milliman, maps the trajectory: from univariate actuarial techniques, through generalized linear models, to gradient boosted machine models, and now to explainable boosting machines – a class of model that delivers gradient boosting accuracy with the interpretability that state regulators require for rate filing approval. The shift is happening across the industry, but at very different speeds. “New modeling techniques can extract more value from the same data in terms of risk understanding,” Brinkman said. “Advances in methodologies are as important as bringing in new data sources.”

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The claims tail may prove to be long. Even before the conflict, the International Union of Marine Insurance (IUMI) projected average hull claim costs rising 7 to 22% over five years, while Nordic insurer association Cefor reported in April 2026 that claims cost per vessel sat 33% above pre-pandemic levels. Régis Broudin, global head of marine claims at Allianz Commercial, said the insurer had already received claims notifications from the conflict, “some of which are significant” and potential total losses, with further claims anticipated as cargo deteriorates aboard trapped ships. Those vessels have also faced disrupted maintenance and biofouling, while the growing size of ships is pushing up general average claims – contributions can reach 50% of cargo value, which Allianz notes could exceed US$100 million for a carrier loaded with a few thousand electric vehicles.

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Moody’s projects the global economic impact of physical risk could reach US$41.4 trillion by the mid-2040s. Sea levels are rising, temperatures are climbing, and natural disasters are growing more frequent. A large share of the losses from these events would fall outside existing insurance policies.

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During the 60-day window, the insurance is free — no payment changes hands, and the sanctions exposure is arguably manageable. But after day 60, if the PGSA introduces fees as it has explicitly reserved the right to do, a shipowner acquiring PGSA-approved insurance would be paying a sanctioned entity. That creates a direct conflict between the operational need to comply with PGSA requirements and the legal prohibition on transacting with OFAC-designated organisations. The MOU’s “toll-free” guarantee does not extend to insurance fees. The US position, per JD Vance on Thursday, is that “international waterways should be free of tolls” — not free of insurance premiums.

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Matthew Eby, founder and chief executive officer of First Street, said the more fundamental challenge is the data underwriting models are using. “Most underwriting for real assets still uses historical data, but the climate is no longer behaving the way the historical record would predict. As heat, drought, and water stress increase, outdated models simply don’t offer a complete view of risk anymore,” he said.

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Within 24 hours of Trump’s announcement, Iran signalled that ships could still face charges beyond the 60-day window – not “tolls” (a term with clear illegal implications under Article 17 of the Law of the Sea Treaty, which guarantees innocent passage) but “fees for services provided.” The distinction is, as one legal expert put it, “entirely semantic in commercial terms.” Meanwhile, Israel has not stopped attacking Lebanon. The 2026 Lebanon war continues even as Israeli and Lebanese officials hold Washington talks – with Israeli forces conducting strikes near Beirut as recently as 3 June, and another proposed ceasefire on 1 June already under strain. And Iran has yet to publicly confirm the US version of the MOU text, with a physical copy of the document yet to be released by Tehran.

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The case goes back to a road accident on July 11, 2018, on a residential street in Barnoldswick. David Maher was standing beside his parked work van, door partly open, when a pickup driven by AXA’s insured, Mr Grogan, came down the street and trapped him between the van and the vehicle. The trial judge found Grogan caused the crash, and that was never in dispute on appeal. 

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