Currently, the immediate impact of the ongoing conflict in the Middle East is negligible for global reinsurer SCOR in terms of claims, as the company’s Chief Executive Officer (CEO), Thierry Léger, emphasises that the reinsurance industry “can respond to such challenges.”
Speaking to the media after the release of a strong set of results for the fourth quarter and full year 2025, SCOR’s CEO commented on the situation in the Middle East.
“First of all, our thoughts are with the populations in the affected countries. War should always be a means of last resort only, and we hope that the conflict can be resolved soon. For SCOR, the immediate impact in terms of claims is negligible at this point in time. War is excluded from most of our contracts and where covered, our exposures are clearly limited, monitored and priced for,” he said.
The Middle East conflict escalated over the weekend, with numerous strikes from the US and Israel leading to retaliatory attacks from Iran, triggering significant destruction and disruptions across the region.
In light of the grave situation, Léger was asked whether SCOR is taking any notable underwriting action to limit any exposure.
“It’s yes and no,” said the CEO. “Our contracts usually are renewed for one year. With fixed durations on all those contracts, you’re at risk. But very generally, contracts exclude war, war is one of the strongest exclusions in reinsurance, it’s an exclusion that is applied everywhere, as a standard. So, when we cover war, in certain lines of business, then it is done in a way that is well controlled.”
He underlined that the Paris-headquartered reinsurer monitors the risk closely, and thus is not carrying unknown exposures, which is important.
“That’s also why when you look at property, most of the risks exclude war. There’s some properties that have paid for specific war cover, and then we cover that with that inclusion. So, there are indeed some exposures in the region, property exposures, usually bigger ones, that include a war cover. But again, limited, clearly controlled and everything.
“Beyond that, it’s clear that we have other covers that are specific for war – political violence, political risk, that’s their business, so nothing to worry about, that’s just the business we are in. And then, beyond that… it’s also marine, and marine we have the ability to cancel the cover, and so that’s a process that’s on our clients side. So, our clients in places where war is starting, actually, are looking very closely and monitoring very closely what is going on, and indeed are cancelling policy covers,” said Léger.
On the aviation side, the CEO noted that everyone is watching the development as there’s both planes on the ground and in the air, although he expressed hope that planes in the air will not be an issue.
“Not so much because of us insurers and reinsurers, but otherwise, I hope we are fine in the air and can still fly. There are planes on the ground, this is an area of heightened attention. There are similar possibilities, of course, to address covers, but in aviation typically there is a difference between war and non-war, and war is typically very limited, clearly defined, and priced for,” he said.
“So, overall, really nothing to worry about here with this conflict, it’s the core of our business, we know how to handle it. Even if it goes a bit longer, the industry can respond to such challenges,” concluded Léger.
Yesterday, S&P indicated that reinsurers’ capital adequacy is strong enough to mitigate the potential risk of credit quality deterioration as a result of the war in the Middle East, warning that the most impacted will be those with broad geographic footprints and significant exposure to specialty markets in the region.
