For the insurance industry, and especially the Political Violence & Terrorism (PVT) business, the war in the Middle East may lead to significant losses in some areas and new risk assessments for selected key industries and regions, according to the "Political Violence and Civil Unrest Trends 2026" report from Allianz Commercial.
In this edition of the MEIR Dialogue, we speak to Norton Rose Fulbright's Partner and Head of Middle East Insurance Shabnam Karim on the far-reaching impact of the current conflict in the Middle East on the regional and global (re)insurance industry. The ongoing hostilities have created an extraordinarily complex risk environment, and insurers, reinsurers, brokers, and policyholders alike are grappling with a range of coverage, claims, and regulatory challenges that extend well beyond traditional war and terrorism exposures.
The global outlook remains highly uncertain amid an increasingly prolonged confrontation and fragile ceasefire between the US and Iran. Drawn-out negotiations, ongoing shipping blockades and the risk of military escalation threaten the truce's durability, says Moody's Ratings (Moody's) in its "Global Macro Outlook (May 2026 Update)" report.
Hannover Re, one of the world's leading reinsurers, has reported a strong start to 2026, continuing positive trends from recent quarters, despite the uncertainties created by the Middle East conflict.
Reinsurance giant Munich Re has allocated EUR90m ($105.6m) in the first quarter of this year for claims for damages from the Middle East armed hostilities, according to the company's CFO, Mr Andrew Buchanan.
Moving cargo in and out of countries by air has been impacted by the conflict in the Middle East, even as flights in and out of the region have started to return to normal.
Global reinsurance giant Swiss Re has set aside an additional reserve of $400m for the Middle East war.
The hostilities in the Middle East have triggered a surge in discussions and notifications regarding Constructive Total Loss (CTL), but these have not yet translated into a material rise in accepted claims. The industry is seeing a trend where assets remain physically undamaged but are effectively "trapped" in conflict zones.
Recent global developments have underscored the growing importance of marine insurance and war risk coverage, placing new pressures on the insurance sector, according to a senior official of the Financial Services Authority (FSA).
Deutsche Ruckversicherung's (Deutsche Ruck) recently established international market activities in property and casualty business across the Middle East, Asia and Latin America have been brought into closer alignment within a new International Growth Markets Division, with effect from 1 May 2026.