The surge in war-risk premiums on Ormuz is reshressing the maps of the roads between the Gulf and Africa, exposing the fragilities of the African maritime insurance and trade financing markets.
The Ormuz Straits crisis crystallized on February 28, 2026, when coordinated US and Israel strikes against Iran triggered a rise in risks on this strategic route, prompting several shipping insurers to suspend or renegotiate their war coverage for ships operating in the Gulf. According to the chronologies established by international institutions, this escalation was accompanied by a rapid increase in insurance premiums against war risks for transits through Hormuz.
The challenge for African financial actors is clear: how to absorb a geopolitical risk that is now priced at dozens of base points of ship value per transit, even though local maritime insurance capacities remain limited?
How the Hormuz crisis shifted the center of gravity from risk
In the days leading up to the strikes, the war-risk premiums applied to ships crossing Ormuz increased from approximately 0.125% to a range of between 0.2% and 0.4% of the insured value of the ship and its cargo for each transit. At the beginning of June, market analysts estimated that the seven-day war-risk coverage for a ship crossing Hormuz was now trading at around 4% of the value of the ship, each crossing having to be reported individually to the insurer.
The International Maritime Organization (IMO) confirmed in the spring of 2026 at least 46 attacks against navigation in and around the strait, resulting in the death of 14 sailors, illustrating that the risk is no longer theoretical. Meeting on March 18 and 19, 2026, the IMO Council called for the establishment of a safe crossing framework, while condemning threats and attacks that disrupt world trade. The immediate financial consequence can be read in contracts: multiplied premiums, shortened coverage periods, increased exclusions.
Faced with this combination of operational risk and additional insurance costs, major global shipowners such as Maersk, Hapag-Lloyd and CMA CGM have redirected some of their ships around Africa, abandoning both Hormuz and the Red Sea to bypass the Cape of Good Hope. For African shippers, this decision results in extended transit times, increased fuel consumption and freight rates incorporating risk premiums that are no longer only related to the goods, but also to the choice of route.
Why African maritime insurance markets are on the front line
Several international maritime insurers have notified the termination or suspension of their war coverage on the Arabian-Persian Gulf, making it economically impossible for many shipowners to transit through Ormuz without guarantee. The IMO Secretary General recalled in June 2026 that the final responsibility for risk assessment and travel planning lies with the airlines and captains, but this responsibility is framed by the possibility of obtaining insurance coverage at an acceptable price.
In this context, African insurers and reinsurers of maritime risks – often via regional pools or specialized subsidiaries – find themselves stuck between two forces: the need to remain aligned with the clauses and exclusions of the London or Dubai markets, and the political and commercial pressure to maintain oil and strategic product flows to the continent. Most of the war-risk capacity still remains housed outside the continent, which limits the room for maneuver of many African insurance regulators.
In Egypt, a marine insurance market leader described an « unprecedented » increase in war risk premiums for cargo ships and ships operating on the Ormuz and Red Sea roads, stressing that policies must now incorporate scenarios of delays and project interruptions previously considered extreme. For African brokers, these premium levels result in multiplied insurance budgets for oil importers, refiners or traders operating between the Gulf and hubs such as Djibouti, Mombasa or Durban.
Diverted roads, rising costs: the hidden bill for African trade
The On
For an African importer of refined products or consumer goods, the combination of these additional insurance costs, detours through the Cape of Good Hope and the volatility of freight rates translates into a sustainable increase in the cost of freight insurance (CIF). Continental commercial banks, which finance these flows via letters of credit, must integrate new parameters into their risk models: increased exposure to the risk of delay, complexity of force majeure clauses and increased counterparty risk on the most fragile charterers.
Recent work on the evolution of red-sea war premiums shows that after the first wave of crisis, premiums do not immediately return to previous levels, even when the frequency of attacks decreases, as insurance markets wait for the threat to be perceived as permanently resolved. For several African economies that are very dependent on oil imports via Djibouti or southern African ports, this persistence of high premiums turns into direct pressure on domestic prices and balances of payments.
When insurance becomes a geoeconomic tool for the Strait of Hormuz
The European maritime authorities have officially classified the Strait of Hormuz and some adjacent waters as a war operations area as of March 5, 2026, inviting shipowners to be vigilant and calling on them to rely on maritime threat analysis centers to plan their transits. At the same time, the IMO Council called for the creation of a safe crossing framework, implicitly acknowledging that the price of insurance is now a parameter as structuring as the military presence to decide which roads remain open.
For African financiers – banks, foreign trade, import-export banks – this new situation requires a revisiting of the way in which documentary credits, foreign exchange coverage and state guarantees are structured. The question is no longer only whether a flow will pass through Ormuz or through the cap, but who will bear the additional insurance cost, and under what law these contracts will be arbitrated in the event of a disaster or blockage.
In the coming months, several projects will be decisive: strengthening marine and war-risk underwriting capacities within African groups, dialogue between banks and insurers on the sharing of the risk of delay, and possibly implementation, at the regional level, of targeted public guarantee mechanisms on the most exposed roads.
To remember
- The crisis triggered on February 28, 2026 in Ormuz caused a sharp increase in war-risk premiums, making insurance a key factor in the economic closure of the Strait.
- Local maritime insurance capacities in Africa remain limited, forcing the continent’s actors to endure the conditions of international markets to ensure their flows.
- The bypass by the Cape of Good Hope sustainably increases freight costs to Africa, with a direct impact on domestic prices and financing needs.
- African regulators and institutions must integrate the risk of geopolitical insurance into the supervision of banks and the architecture of guarantees to foreign trade.
source : capmad
