Insurance Marketplace Realities 2026 Spring Update – Marine Hull and Liability

Key takeaway

Over the past 18 to 24 months, the marine insurance market has been trending toward a softer cycle, driven by new entrants, increased capacity and competitive pressure among carriers. Rate reductions and broader terms were becoming more common, creating a favorable environment for buyers.

However, that trajectory has been abruptly disrupted by recent geopolitical developments, most notably escalating tensions involving Iran and instability in the Strait of Hormuz. These events have reintroduced systemic risk into the market almost overnight.

We are now operating in a bifurcated environment. Standard, non-exposed trading risks continue to benefit from competitive conditions, while any exposure tied to geopolitical hotspots is being aggressively repriced or restricted.

The key takeaway is that this is no longer a traditional insurance cycle. Market behavior is being driven less by underwriting competition and more by capital preservation, aggregation concerns and geopolitical uncertainty.

The Strait of Hormuz remains one of the most critical chokepoints in global trade, with approximately 20% of the world’s oil supply transiting through it. Any disruption in this region has immediate and far-reaching implications across energy markets, shipping routes and insurance pricing.

Recent attacks, threats and heightened military activity have significantly reduced vessel traffic and forced operators to reconsider routing decisions. This has introduced both operational and financial strain across the supply chain.

War risks is no longer a specialty line — it's a core

Historically, war risk was treated as a specialized add-on to marine programs, often carved out and managed separately from core coverages. That distinction is no longer valid in today’s environment.

War-related exposures are now directly influencing hull, P&I, cargo and broader marine liability placements. The interconnected nature of global trade means that a single geopolitical event can trigger multiple lines simultaneously.

The Jones Act Waiver

The recent Jones Act waiver introduces a meaningful, albeit temporary, shift in the U.S. maritime landscape by allowing foreign-flagged vessels to participate in domestic trade.

In the short term, this increases available capacity and helps alleviate supply chain bottlenecks, particularly in energy and bulk commodity movements.

However, the longer-term implications are more complex. U.S. flag operators may face competitive pressure, and the overall risk profile of domestic trade becomes more diverse as new operators, vessels and standards are introduced.