How Insurance Shapes Trade in the Strait of Hormuz

In this Global Insight episode of the On Aon podcast, Aon transportation and marine leaders examine the evolving risk environment in the Strait of Hormuz — one of the most critical corridors for global energy and trade. The discussion focuses on how shifting conditions are impacting trade flows, how insurance markets are responding in real time and what capacity and pricing signals reveal. It also highlights the role insurance plays in enabling global trade and what organizations should be watching as they plan for continued disruption.

Key Takeaways:

1. Insurance remains available to support global trade through the Strait of Hormuz, even as risk has intensified and pricing has adjusted significantly. The primary constraint on vessel movement continues to be safety, not the withdrawal of insurance capacity.
2. Marine and war insurance mechanisms are designed for active risk management. Notice provisions enable insurers to reassess accumulation, reprice exposure and maintain coverage in response to changing conditions, supporting continued market function.
3. Leadership advantage comes from preparedness and adaptability. Organizations that understand supply chain vulnerabilities, engage closely with brokers and insurers and plan for both immediate and mid-term disruption are better positioned to sustain continuity and act with confidence as conditions evolve.

Experts in this episode:

• Philip Smaje, Global Industry Specialty Leader, Transportation and Logistics, Aon
• Lee Meyrick, Chair, Risk Capital, Transportation and Logistics, Aon

Key moments:

(01:30) Why the Strait of Hormuz matters to global trade — and how its geography concentrates systemic risk.

(04:00) How insurance markets are responding, including the role of war cover, notice provisions and disciplined repricing.

(08:05) How insurance markets are responding in real time, including dynamic pricing, notice mechanisms and capital entering the market.

(13:00) What leaders should prioritize next to stay ahead, from contingency planning to preparing supply chains for extended disruption.

Soundbites:

Philip Smaje:

“The strait remains one of the most strategically important corridors in the world, particularly for energy, shipping and supply chains. But what often gets overlooked in these situations is the role insurance plays in determining whether trade can continue at all.”

Lee Meyrick:

“I think what we're seeing now is that there's an increase in both frequency and severity of new risks. And whilst geopolitical risks, as in the case of the current situation in the Strait of Hormuz, isn't new, I think the frequency and severity of these incidents are putting pressure on the marine insurance industry.”