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ENGINE: War-risk premium soars to 0.75-1% as the Red Sea attacks enter third month

Heightened insurance rates can actually make the Cape of Good Hope routing more cost effective for carriers relative to the Suez Canal despite the higher bunker fuel costs, says Flexport.
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RESIZED Chris Pagan

War-risk insurance premium has now climbed to 0.75-1% of the vessel’s value, according to US-based supply logistics firm Flexport reports.

According to Flexport, shipowners will now have to pay roughly $1-2.5 million for war-risk insurance cover, depending on vessel age, size and type.

In addition to the soaring annual premium, shipowners will also have to pay an additional premium if they want to transit via the Red Sea. It is because several Protection and Indemnity (P&I) clubs have expanded their additional premium zones across the Indian Ocean, Gulf of Aden and Southern Red Sea.

“The heightened insurance rates can actually make the Cape of Good Hope routing more cost effective for carriers relative to the Suez Canal despite the higher fuel costs,” Flexport writes.

Major container lines avoid Red Sea as attacks enter third month

Yemen’s Houthi rebel group started attacking commercial ships in the southern Red Sea and the Bab al-Mandeb Strait between Yemen and Africa on 19 November 2023.

Since December, over 26 vessels have faced missile strikes, near misses or threats from the Houthis, according to marine risk management firm Ambrey. This includes vessels owned by major shipping companies, including A.P. Moller-Maersk, Mediterranean Shipping Company (MSC) and CMA CGM.

Several shipping companies, including MSC, Maersk, Hapag-Lloyd, Wan Hai Lines, Ocean Network Express (ONE), HMM, Evergreen and Yang Ming, have rerouted their vessels via the longer Cape of Good Hope route to avoid these attacks.

As of 18 January, 549 container ships have been diverted or are planning to reroute via the Cape of Good Hope instead of the Suez Canal route to avoid Red Sea attacks, Flexport says.

Meanwhile, Bloomberg reported that “some ship insurers are starting to avoid covering US and UK merchant ships against war risks when they navigate the southern Red Sea,” citing Marcus Baker, global head of marine and cargo at Marsh. This could result in US and UK-based commercial shipping companies also rerouting through The Cape of Good Hope in the near future.

By Konica Bhatt

 

Source: ENGINE
Photo credit: Chris Pagan on Unsplash
Published: 23 January, 2024

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MPA ‘deeply concerned’ over projectile strike on Singapore-registered ship in Hormuz Strait

Container ship “Ever Lovely” sustained minor damage to the bridge area from an unknown projectile while leaving the Strait of Hormuz on 25 June at about 10pm (Singapore Time).
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June 29, 2026

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Container ship “Ever Lovely”

The Maritime and Port Authority of Singapore (MPA) on Friday (26 June) said the Singapore-registered container ship Ever Lovely sustained minor damage to the bridge area from an unknown projectile while leaving the Strait of Hormuz on 25 June at about 10pm (Singapore Time). 

The vessel has since completed its transit through the Strait of Hormuz and is proceeding on its voyage.

“All 21 crew members are safe. There are no Singaporeans onboard,” MPA said in a statement. 

MPA said it will continue to remain in close contact with the vessel’s management company and provide the necessary assistance.

“MPA is deeply concerned about the incident, which was unprovoked, unjustifiable, and a breach of international law,” it added.

“All actions affecting international shipping must fully comply with international law, in particular the United Nations Convention on the Law of the Sea, and not endanger the safety of seafarers and ships at sea.”

 

Photo credit: MarineTraffic / Michael Schindler
Published: 29 June, 2026

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IMO announces large scale evacuation plan for stranded ships, seafarers in Strait of Hormuz

IMO Secretary-General Mr. Arsenio Dominguez said it marked a decisive step towards restoring maritime security and bringing to an end the unacceptable attacks against civilian shipping.
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June 24, 2026

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IMO

The International Maritime Organization on Tuesday (23 June) said it will begin implementing the evacuation plan for over 11,000 seafarers still stranded in the Strait of Hormuz. 

This comes following the signing of the Memorandum of Understanding between the Islamic Republic of Iran and the United States. 

In welcoming the peace agreement, IMO Secretary-General Mr. Arsenio Dominguez said it marked a decisive step towards restoring maritime security and bringing to an end the unacceptable attacks against civilian shipping.

“This large-scale operation will be carried out in close cooperation with Iran, Oman, all other coastal States in the region, the United States and the maritime industry,” he said in a statement. 

“We have secured the necessary safety guarantees and have thoroughly verified the conditions for safe navigation to support these operations.

“We remain fully committed to ensuring the safety of seafarers and the continuity of global trade.”

 

Photo credit: International Maritime Organization
Published: 24 June, 2026

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UK forces intercept suspected Russian shadow fleet tanker in English Channel

In the first UK-led operation of its kind, the vessel “SMYRTOS” was boarded by Royal Marine Commandos and law enforcement officers from the National Crime Agency.

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June 16, 2026

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UK forces intercept suspected Russian shadow fleet tanker in English Channel

British Armed Forces on Sunday (14 June) boarded a sanctioned oil tanker, suspected of being part of the Russian shadow fleet, in the English Channel, according to the Ministry of Defence. 

In the first UK-led operation of its kind, the vessel SMYRTOS was boarded by Royal Marine Commandos and law enforcement officers from the National Crime Agency.

The UK’s Prime Minister agreed in March that British Armed Forces and law enforcement officers were able to board shadow fleet vessels, in accordance with international law.

The SMYRTOS will be provisionally moved to an anchorage off the South Coast of England and will be monitored for any environmental or safety concerns.

UK’s Prime Minister Keir Starmer, said: “This operation delivers yet another blow to Russia and reminds those fueling Putin’s war in Ukraine that they cannot hide.

“I want to pay tribute to all those involved, including our Armed Forces and law enforcement officers who keep this country safe 24 hours a day, 365 days a year.”

The operation builds on recent support provided by the UK to its allies to interdict shadow fleet vessels, which included RAF and Royal Navy capabilities supporting US and French operations. The operation was conducted in close coordination with the French.

The UK has sanctioned almost 600 Russian shadow fleet vessels to date.

 

Photo credit: Ministry of Defence
Published: 16 June, 2026

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