Hiscox, the specialist global insurer, has developed a new insurance product that provides coverage for ships seized by a foreign government.
The product, called Malicious Vessel Seizure, will provide Loss of Hire costs and the services of Control Risks, a crisis management consultancy.
The announcement follows the seizure of a British-flagged oil tanker by Iranian forces last week, which has raised tensions in the Middle East, particularly in the politically sensitive area of the Strait of Hormuz.
This latest incident follows other attempts to seize a British registered vessel in retaliation for an Iranian tanker that was boarded by British forces off Gibraltar.
As well as meeting Loss of Hire costs, Hiscox will provide for the services of Control Risks, who will help the shipowner or charterer with crisis management support, including government liaison and family support for victims.
“In recent months we’ve seen growing political tension between the US and Iran which has recently culminated in the seizure of a British flagged tanker in the Strait of Hormuz,” said Stuart Bisson, Head of Guernsey and Europe for Hiscox Special Risks.
“We have developed Malicious Vessel Seizure to respond directly to incidents like this where a ship owner or charterer has their vessel seized by a nation state who may have taken the ship as a retaliatory measure,” he explained.
“It provides ship owners and charterers with the reassurance of knowing that they have the resources and expertise of Control Risks to help them manage the crisis as well as the financial support of Hiscox to meet their Loss of Hire costs.”
Analysts at law firm DWF recently suggested the siezure of the British tanker by Iran could have knock on effects for global oil prices and insurance premiums, with growing geopolitical uncertainty potentially causing insurers to raise prices.