Saudi Re has announced that it has been appointed to head the Saudi Pool for Marine War Risk Insurance.
In a statement lodged with Tadawul on 10 September, Saudi Re said that the appointment followed the approval of the Cabinet for the establishment.
The reinsurer also said in the statement, “This national initiative establishes cooperation between the public and private sectors and aims to enhance the Saudi insurance market’s readiness to address marine insurance risks, support the continuity of trade flows and supply chain, mitigate the impact of fluctuations in global reinsurance markets, and support Saudi Arabia’s competitiveness as a global logistics hub.”
Separately, the Insurance Authority on X on 9 September said, “The Saudi Pool for Marine Insurance embodies effective cooperation between the government and the Saudi private insurance sector to enhance insurance market resilience and the continuity of trade and supply chains, thereby supporting Saudi Arabia’s competitiveness as a global logistics hub.”
The Insurance Authority also said that the Pool would provide the following coverage:
- Marine, Land and Air Cargo Insurance
- Hull Insurance
- Charterers’ Liability Insurance
- Protection and Indemnity Insurance
It added that beneficiaries would include:
- Exporters and importers,
- Vessel operators. shipping and maritime transport companies,
- Sectors linked to the supply chain in the Kingdom
- Insurance companies
The UK newspaper Financial Times (FT) reported in August that Saudi Arabia was exploring establishing a state-backed war risk insurance programme to reduce insurance costs for ships and cargo as geopolitical risks escalate in the region. The report said that the Saudi Ministry of Finance held talks with insurance brokers in London about establishing an insurance pool that could provide commercial coverage of up to SAR700m ($187m) for each insured incident, such as a ship being targeted by a missile or being seized.
The Pool was proposed after insurance companies raised their prices and reduced coverage for ships, infrastructure, oil shipments and chemicals in the region, as the war with Iran continues and Houthi attacks escalate. In some cases, insurers refuse to provide coverage for war risks for ships intending to transit the Strait of Hormuz or the Red Sea.