Leaders at global insurance and reinsurance broking group Aon have shared their observations and perspectives on numerous lines of insurance business as the conflict in the Middle East continues, as Joe Peiser, CEO of Risk Capital for Aon, highlights that for many organisations the most significant exposure is disruption to supply chains, logistics routes, and coverage structures.
On the 12th day of the conflict in the Middle East, Aon hosted a webinar, “The Middle East Conflict: What Matters Now for Global Organizations”, during which leaders and experts from the firm discussed what their seeing right now across different insurance markets.
“We’re seeing risk repriced in real time — often before it shows up in financial results,” said Peiser. “Insurance markets are reacting as events unfold, making them an early warning signal for organizations navigating geopolitical disruption.”
He went on to stress that for many entities, currently, the most significant exposure isn’t physical damage, but rather sustained disruption to supply chains, logistics routes, and coverage structures.
“This is the moment to test assumptions — about how policies respond, where coverage ends, and whether alternative structures are needed — while organizations still have options to strengthen resilience,” said Peiser.
According to Tracy Lee Kus, CEO of Aon’s Global Broking Center, “London remains a central coordination point for war risk – particularly marine war – and for political violence more broadly.”
She stated that the London marine and war markets have continued to offer coverage across the Middle East, which helps to keep important trade routes both insurable and open.
“Capacity and pricing have been adjusted, but the fundamental choice has been to remain present in challenging territories rather than exiting at the first sign of trouble. This conflict is not a single-line issue. It cuts across many lines, including marine, energy, aviation, property, cyber and credit portfolios. London is at the center of modelling those cross-class accumulations and stress-testing capital, drawing on lessons from previous geopolitical crises. This allows the market to support clients while still protecting its own balance sheet and the wider reinsurance ecosystem,” she said.
Lee Kus’ comments are in line with those of Chris Jones, Chief Executive of the International Underwriting Association, who said today that members are still providing cover for clients affected by the hostilities involving Iran across several lines of business.
As noted by Phil Smaje, Global Industry Speciality Leader, Transportation and Logistics for Aon, both marine and aviation are vitally important to global trade and very much in focus as the conflict persists.
“Starting with marine, based on our information there were roughly 750 vessels, with a combined value of approximately $25 billion in the Persian Gulf when the conflict started on 28 February. Marine hull war cover operates through annual policies with defined restricted areas set by the Joint War Committee. Those Listed Areas are reviewed continuously, and particularly during periods of heightened hostility, insurers have the ability to amend them. The purpose of that mechanism is not market dislocation. It exists to allow rates to be adjusted, areas to be redefined and cover to be renegotiated and reinstated where appropriate,” explained Smaje.
Smaje emphasised that this framework has been in place in the Lloyd’s marine market for more than 300 years, adding that while it is clearly a stressed environment, the system is functioning as it should be.
“The primary concern for insurers right now is accumulation — how exposures stack up geographically — and whether pricing properly reflects that risk. Our expectation is that the market will continue to respond in a measured and pragmatic way, with the objective throughout being continuity: keeping clients insured and trading wherever possible,” he said.
As we wrote earlier this week, the United States International Development Finance Corporation (DFC) and the U.S. Treasury have unveiled a plan to deploy Maritime reinsurance, including war risk, in the Gulf region. The facility will insure losses of up to $20 billion on a rolling basis.
In terms of the aviation market, Smaje noted that insurers are taking a cautious but measured stance, with underwriters paying greater attention to ground accumulations at major hubs such as Dubai, while also asking more detailed questions around routing, airport selection, and also contingency planning for aircraft relocation.
“At this stage, we are not seeing widespread notices of cancellation. That reflects both market precedent and a relatively established understanding of how war perils are interpreted in aviation placements. For most businesses, the near term impact is less about structural change and more about clarity—clarity of cover, policy wording, and how placements are handled.
“Looking ahead, a more material market shift would likely require clearer triggers, such as insured losses emerging, changes in how key aviation or war markets deploy capacity, or a firmer reinsurance response at upcoming renewals. A combination of those factors would be the clearest signal that we’re moving from a period of adjustment into something more structural,” said Smaje.
Regarding the political risk space, Sarah Taylor, Head of Political Risks and Structured Credit at Aon, said that insurers are taking a deliberate and measured approach as they work to try to understand how the situation could evolve and where any secondary impacts may come from.
“The focus is not limited to physical damage, but on how disruption can affect contracts, operations and counterparties over time. For organizations with exposure in or near the region, the most productive step is early engagement — understanding how existing coverage would respond and where assumptions may need to be revisited, particularly ahead of renewals,” said Taylor.
In today’s interconnected world, geopolitical escalation often leads to heightened cyber activity which often extends far beyond organisations operating in the region of conflict. This was highlighted by Brent Reith, Global Cyber Leader for Aon, who called on organisations to “treat the current environment as a materially elevated cyber threat, making incident response readiness just as critical as threat monitoring.”
He continued: “Threat actors with geopolitical motivations tend to focus on high-impact sectors like financial services, energy, transportation and technology, particularly where shared cloud and SaaS dependencies create systematic exposure. Because cyber risk now touches nearly every business operation, having trusted partners in place can make the difference between a contained event and prolonged operational disruption.”
Last week, CyberCube highlighted elevated cyber risk from Iran following the US-Israel strikes, and called on cyber insurers to use threat-intelligence-informed analytics to assess and manage exposure.
Credit insurance companies are also closely monitoring developments in the region, debating what they could mean for global trade flows and supply chains, which will likely be disrupted further the longer the conflict lasts.
Oliver Henderson, Chief broking officer, Credit Solutions for Aon, said: “What matters most from an underwriting perspective is how delays and interruptions translate into liquidity pressure over time. While uncertainty has increased, underwriting appetite remains broadly intact, with insurers taking a more selective, scenario-based approach. For clients, timely information and disciplined credit management are key to maintaining confidence and
continuity of cover.”
Lastly, Charles Philpott, Global Natural Resources Leader at Aon, offered his thoughts on the implications for the energy sector.
“For a long time, geopolitical risk in energy sat largely in the background and was absorbed through commodity prices. What’s different now is that the impact is showing up more directly in access and operability, which has meaningful implications for how the energy system functions under stress.
“Even where energy infrastructure and shipping lanes remain physically open, the ability to keep oil and gas moving is becoming more constrained by external pressures, turning geopolitical risk into a core cost of energy rather than just a source of price volatility,” he said.
