US launches $20 billion Gulf shipping insurance plan

Bilkul Online

8 months ago

Washington, March 7 : The United States unveiled a $20 billion maritime reinsurance plan aimed at protecting shipping and stabilising trade through the Gulf region amid tensions linked to the conflict with Iran. The initiative was announced by the US International Development Finance Corporation (DFC) and the US Department of the Treasury following President Donald Trump’s approval of a detailed implementation strategy.

DFC Chief Executive Officer Ben Black and Treasury Secretary Scott Bessent said the programme will deploy maritime reinsurance coverage, including war risk insurance, for vessels operating in the Gulf. Officials said the plan is designed to restore confidence in shipping lanes and support global commerce during the ongoing crisis. “Working alongside CENTCOM, DFC coverage will offer a level of security no other policy can provide,” Black said in a statement. The programme is intended to ensure that critical commodities continue to move through the region. “We are confident that our reinsurance plan will get oil, gasoline, LNG, jet fuel, and fertilizer through the Strait of Hormuz and flowing again to the world,” Black added. The new facility will insure maritime losses of up to about $20 billion on a rolling basis. Officials said the insurance will apply only to vessels that meet specific criteria under the programme. Initially, the coverage will focus on Hull & Machinery as well as Cargo insurance for eligible ships.

The US government said the programme will rely on selected American insurance companies identified as preferred partners. Officials said coordination is underway with the United States Central Command (CENTCOM) on the operational rollout. The initiative marks what officials described as a key milestone in implementing the president’s directive to use the DFC’s financial tools to protect maritime trade during the regional crisis. Authorities said the insurance structure is designed as a revolving facility, allowing coverage to continue as ships enter and exit the region. Businesses and financial institutions seeking access to the maritime reinsurance programme have been asked to contact the DFC directly for further details. The Gulf shipping corridor, particularly the Strait of Hormuz, is one of the world’s most critical energy transit routes. A large share of global oil and liquefied natural gas shipments passes through the narrow waterway connecting Gulf producers to international markets.