Howden opens new cargo war risk facility for ships in the Red Sea

Howden opens new cargo war risk facility for ships in the Red Sea | Insurance Business Australia

Marine

Howden opens new cargo war risk facility for ships in the Red Sea

New proposition offers up to US$50 million per insured vessel

Marine

By
Kenneth Araullo

Global insurance group Howden has announced the introduction of a new cargo war risk facility aimed at providing coverage for vessels against drone and missile attacks by Yemeni militia groups in the Red Sea.

The new insurance facility offers coverage up to US$50 million per vessel, with the highest coverage amount provided so far reaching US$150 million. The facility specifically targets risks in the Bab al Mandab Strait, the Red Sea, and the Indian Ocean, areas currently affected by active conflicts.

Howden noted that this is the first insurance product specifically designed to safeguard cargo vessels operating in these high-risk zones, demonstrating the firm’s initiative in addressing complex global risks and mitigating the impact on international supply chains.

Within the first month of its launch, Howden said that it had already secured policies across four continents, offering a more efficient route for shipments through the Red Sea and Suez Canal. This route avoids the alternative of navigating around the Cape of Good Hope, which can extend a typical Far East to Europe voyage by two weeks and increase emissions by 70%.

Ellis Morley, associate director of cargo and commodities at Howden, explained how the conflict in the Red Sea is presenting a significant obstacle to clients with operations in the region.