At discussions held during the Association of Insurance and Financial Analysts conference, re/insurance executives and analysts struck a cautiously constructive tone on Middle East conflict exposures, broadly agreeing that related losses remain “manageable” for re/insurers so far.
Overall, sentiment suggested losses are contained, with analysts noting that “the situation remains fluid” but that most exposures are well understood and often retained by primary insurers.
Autonomous said that war losses related to the conflict in Iran continue to evolve, though these risks are well understood in a region where conflict is not new.
Meanwhile, KBW highlighted that the most directly affected segments are specialty lines, particularly “political violence, ocean marine, and trade credit,” with shipping disruptions driving “meaningful rate increases” in marine insurance.
Still, according to KBW, executives broadly characterised insured losses from the Middle East conflict as very manageable so far, even though losses remain unquantified as the event continues to unfold, and few appeared concerned about their current exposure levels.
“Iran’s sanctioned status limits insurable interest there; losses tied to Israel have been modest, and war exclusions provide a meaningful backstop across most commercial lines. That said, the situation remains fluid, and we are cautious given the conflict’s geographic scope and unpredictable trajectory,” KBW added.
At the same time, RBC Capital Markets analysts said potential losses could emerge in marine-war and specialty commercial lines but emphasised that for most insurers, exposure was described as “immaterial” or limited in scale.
Goldman Sachs similarly characterised exposure as generally contained, noting that while losses may occur, they are often limited by policy structures where war coverage must be purchased separately.
Goldman Sachs added, “Within our covered companies, we believe potential exposure is held mostly by reinsurers and larger specialty insurers. Exposed lines include war, political violence & terrorism, marine hull, and energy, amongst other lines of business.”
From a credit perspective, Moody’s said the near-term impact on Gulf insurers should remain limited under a baseline scenario in which the conflict remains relatively short-lived.
The main risk transmission channel is expected to be through investment portfolios rather than underwriting results, as geopolitical shocks could pressure asset prices linked to regional economic activity.
In related commentary, S&P recently indicated that reinsurers’ capital adequacy is strong enough to mitigate potential risks of credit quality deterioration, although those with broad geographic footprints and significant exposure to specialty markets in the region are likely to be the most affected.
Alongside its 2025 full-year results, global reinsurer SCOR said the immediate impact of the ongoing Middle East conflict is negligible in terms of claims, with Chief Executive Officer Thierry Léger emphasising that the reinsurance industry “can respond to such challenges.”
