India Plans Sovereign Guarantees for Insurers Amid Increased Shipping Risks Due to Iran Conflict
India is preparing to offer sovereign guarantees to insurers covering vessels traveling through the Persian Gulf, as the ongoing conflict in the Middle East has heightened shipping risks. According to government and industry sources, the plan includes a $1.5 billion sovereign guarantee fund to provide reinsurance support and liquidity to insurers facing high costs. Additionally, a separate $300 million fund, contributed by the country's insurance industry, is being established to manage potential increases in insurance claims. The conflict, which began with U.S. and Israeli attacks on Iran, has led to a significant rise in maritime war risk insurance premiums, with some cases seeing increases of up to 1,000%. This has resulted in higher costs for shipowners, traders, and energy firms transporting cargo through the region. India's insurance regulator has sought feedback from industry players on the necessary support and implementation strategies for the funding. 
