US Doubles Strait of Hormuz Reinsurance to $40 Billion

The United States has doubled its reinsurance commitment for ships transiting the Strait of Hormuz to $40 billion, adding six major private insurers to a government-backed program aimed at reviving maritime trade amid ongoing regional tensions. The expansion, announced Friday by the U.S. International Development Finance Corporation, builds on an initial $20 billion facility launched last month and seeks to lower financial risks for vessel owners and cargo operators facing war-related threats.

The DFC, working with Chubb as lead underwriter, now includes Travelers, Liberty Mutual Insurance, Berkshire Hathaway, American International Group, Starr, and CNA, which together pledge another $20 billion in coverage on a rolling basis. Chubb will set pricing and terms, assume risks, issue policies, and handle claims for qualifying vessels and cargo. The insurance targets war risks, including hull damage, protection and indemnity liabilities, and cargo losses from conflict. Coverage extends to disruptions linked to drones, missiles, and sea mines in the area, though it does not include naval escorts or physical security assurances.

Eligibility requires rigorous vetting by the DFC and...