Shipowners are placing “huge volume requests” for insurance cover as they look to transit the Strait of Hormuz following the US-Iran ceasefire deal, according to broker McGill and Partners.
With the increased demand from the market also comes “a pronounced rate correction,” said David Smith, head of marine at the London-based firm. He added that despite the ceasefire agreement, “heightened war condit
ions still remain and the Strait of Hormuz is still classified as a very high risk area.”
The Strait of Hormuz remained largely blocked on Wednesday, as shipowners try to understand if they can safely transit the vital waterway following a fragile ce
asefire between the US and Iran that was announced overnight.
That’s as continued fighting in the Middle East, punctuated by Israeli strikes in Lebanon, threatened to derail the US-Iran détente even as the two sides signaled they could soon hold talks to end the six-week conflict.
“The latest news on the ceasefire is positive news and will hopefully ease the passage through the Strait of Hormuz and for ships more generally in the region,
” said Andrew James, managing director, Marine, at broker Arthur J. Gallagher & Co.
“Of course, it is very early days,” James said, but “underwriters are already recognizing the ce
asefire and reducing rates for some risks.” He added that insurers “will continue to be understandably cautious as they watch how this plays out.”
After almost a decade of litigation, investigations and deliberations, criminal fraud cases again
st reported billionaire and North Carolina insurance entrepreneur Greg Lindberg appear to finally be
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nearing an end. A sentencing hearing is expected in the next few months, followed by a federal judge’s decision on how much in restitution Lindberg owes—and to whom.
A special master, a bankruptcy-specialist attorney appointed by the federal court in North Carolina, last week recommended that Lindberg pay just over $1.
6 billion in restitution to seven insurance companies and financial firms in North Carolina and Bermuda. Those are companies that Lindberg once controlled – and fro
m which he was convicted of diverting funds for other enterprises and for personal gain in a
scheme that reached across the continent and involved an attempt to bribe an insurance commissioner.
The largest share of restitution, $821 million, should go to Colorado Bankers Life Insurance Co., the largest of insurers that Lindberg founded, then skimmed millions from over several years.
The funds diversion, as detailed in Lindberg’s federal indictment, constituted “a massive insu
rance fraud conspiracy, the purposes of which ‘were to evade regulatory requirements meant to protect policyholders, conceal the true financial condition of [Defen
dant’s] insurance companies, and conceal [Defendant’s] improper use of insurance company funds for [
Defendant’s] personal benefit,'” Special Master Joseph Grier III wrote in his April 3 report to the court.
