Cambiaso Risso’s Bjork on Iran War Impact on Shipping Insurance

Amanda Bjork, Head of Claims at Cambiaso Risso Asia, said the risk level in the Strait of Hormuz is “very high” speaking from Asia-Pacific Maritime 2026. As a global marine insurance and reinsurance broker, her assessment flags elevated shipping and insurance risk for a key oil transit chokepoint, which could raise freight and hull/war-risk premiums and add near-term pressure to energy and trade flows.

Analysis

A sustained rise in geopolitical friction affecting the Gulf-to-market maritime corridor will transmit quickly through freight and insurance economics: expect marginal voyage times to increase by roughly 7–12 days on reroutes around Africa for VLCC/Suezmax voyages, boosting per-voyage fuel and OPEX by an estimated 10–25% and compressing available vessel days for cargoes. That mechanically supports spot tanker rates and charter rates near-term (days–weeks) while elevating war-risk/terror premiums, which typically adjust within 48–96 hours once underwriter sentiment shifts.

Second-order supply-chain effects will show up as widened regional crude price differentials and temporary closure of light-sweet arbitrage flows — refiners on the consuming end lose cheap feedstock, pushing local refinery margins higher and incentivizing inventory draws. Container and bulk shippers will face both longer transit times and selective port congestion at alternate routing hubs, increasing landed cost volatility for OEMs with tight JIT inventories over the next 1–3 months.

Key catalysts that would normalize markets are rapid diplomatic de-escalation, credible naval convoy protection, or sudden absorption of war-risk capacity by reinsurers — any of which can compress premiums and reverse freight spikes within weeks. Tail risks include a protracted export corridor disruption (months) that forces strategic oil releases and durable shifts in LNG routing; that scenario produces oil price moves of $8–20/bbl in days and a multi-quarter re-pricing of shipping asset values.

Consensus is likely underestimating how quickly premium revenue accrues to brokers and war-risk underwriters versus reinsurers’ claim exposure: premium reset is front-loaded while claim realization can lag. That asymmetry favors short-duration, convex insurance/broker exposure and freight-linked instruments over owning long-duration ship equity outright unless entry is disciplined via options or spreads.

Key Decisions for Investors

• Tanker freight play (1–3 months): Buy Feb–Apr call spreads on VLCC proxy STNG (Scorpio Tankers) or FRO (Frontline) — e.g., buy 3-month ATM calls, sell 1.5× higher strike calls to fund premium. R/R: target 2–3x if TD3/spot rates double; max loss = premium paid if corridor calms.
• Insurance/broker convexity (3–12 months): Long MMC (Marsh & McLennan) or AON 6–12 month call options (or buy stock with a 6–9 month horizon). Rationale: front-loaded premium revenue and fee capture; downside limited to option premium, upside captures re-pricing of advisory & placement fees.
• Oil directional hedge (days–months): Buy 1–3 month Brent call spread (e.g., buy 2-month $x/$x+10 spread) sized as a hedge against physical exposure to refined product inputs. R/R: designed to pay off for $8–15/bbl moves with capped cost; protects operational P&L from immediate crude shocks.
• Cross-asset pair (4–12 weeks): Long XLE / Short XLI (ETFs) — energy producers capture margin expansion while industrials and capital goods face margin compression from higher shipping/input costs. Position size: tactical 3–6% net exposure, trim on commodity-calm or policy de-escalation signals.
• Convex insurance trade (30–90 days): Sell a small put ladder on specialist marine reinsurer/insurer with high implied vol (if available) and buy further OTM puts to limit tail — captures elevated implied premium if realized losses remain muted. Risk: losses if a large casualty occurs; reward: collect premium as vol mean-reverts.