The National Insurance Brokers Association (NIBA) says the conflict in the Middle East is highlighting how quickly the global risk environment can shift and how exposed Australian clients are to geopolitical events. In commentary issued as the situation develops, NIBA presents the conflict as a reminder that risks are becoming more volatile, more interconnected, and harder to anticipate across borders and classes of business.
For Australian travellers, NIBA notes that the immediate concern is personal safety. For brokers and insurers, it views the episode as a current illustration of the “fast‑changing and increasingly complex risk landscape” outlined in its recent research on the broking profession. NIBA’s report, “Ready or Reacting? Shaping the Future of the Insurance Broking Profession,” names the “new risk landscape” as one of three main forces likely to reshape broking over the next decade, alongside regulation and technology. The report describes brokers as shifting from a primarily transactional role toward interpreting risk and explaining the implications of rapid global events to clients.
Survey findings in the report point to a gap between brokers’ expectations of change and their self‑assessed readiness. Seventy‑six per cent (76%) of respondents believe they will need to expand into new risk domains such as geopolitical, cyber, and climate‑related exposures to remain relevant, but only 64% say they feel prepared to manage that shift. NIBA says this preparedness gap is important given changing client expectations and the speed at which shocks can spread through economies and markets. The report’s executive summary states that “by 2035, our profession will be reshaped by global volatility, technological acceleration, escalating cyber threats, and dynamic shifts in insurance markets,” and that brokers “must continue to evolve into trusted advisers, digital innovators, and resilient leaders who thrive amid complexity.”
NIBA’s research identifies eight themes where brokers expect substantial impact but report lower levels of preparedness. Regulatory demands rank highest, with 86% of brokers saying regulation will significantly affect the profession and 62% describing themselves as prepared. Technology and automation follow (83% impact vs 61% preparedness), reflecting ongoing questions about the role of data, digital platforms and artificial intelligence in distribution and advice. The “new risk landscape” is next (76% vs 64%), grouping together geopolitical instability, supply chain disruption, cyber threats, and climate‑related events. Workforce changes (67% impact vs 58% preparedness) and industry consolidation (69% vs 59%) suggest further pressure on staffing models, succession planning, and scale.
Education uplift (75% impact vs 66% preparedness), innovation in insurance products (71% vs 59%), and the broker as strategic adviser (77% vs 65%) indicate that respondents expect greater technical and advisory demands from clients, carriers, and regulators. The report describes brokers as “interpreters of risk” whose ability to turn complex information into practical options is becoming more important as clients confront unfamiliar exposures. It highlights digital capability, data analysis, and scenario planning as tools that can support brokers in their engagement with emerging risks.
While NIBA’s work focuses on the profession’s long‑term direction, the Middle East conflict is having immediate effects on travel insurance and related lines. The Insurance Council of Australia (ICA) has declared the conflict a Significant Event, enabling a coordinated industry approach to claims, data collection, and policy issues. Under the declaration, an industry taskforce has been formed, the ICA has started gathering and analysing claims information with member insurers, and representatives are working with the federal government and agencies “to ensure a coordinated and joined up approach for those Australians impacted.”
Travel insurers have put in additional support for affected customers, including dedicated 24/7 assistance, help in arranging medical care, and priority handling for policyholders in impacted locations. ICA members providing travel insurance have indicated that the coverage date of policies will be extended where customers are affected by airport and airspace closures linked to the conflict. ICA chief executive Andrew Hall said insurers are concentrating on the welfare of travellers as the situation disrupts international schedules. “The conflict in the Middle East will continue to cause significant disruption to the world’s travel network, but insurers’ number one priority for their customers is their safety and security,” Hall said.
Despite the additional measures, the underlying treatment of war and armed conflict has not shifted. Exclusions for war and conflict remain standard features of travel and general insurance policies globally, reflecting the scale and unpredictability of such events and the difficulty of pricing them within conventional insurance frameworks. The ICA notes that losses directly caused by war or armed conflict are generally excluded. However, policies can still respond to other incidents that occur during a conflict period but are not caused by the conflict itself. Depending on the wording, cover may extend to emergency medical expenses arising from unrelated illness or accident, loss or damage to luggage, some evacuation services, or accidental death and disability where the immediate cause is not a war‑related act.
Coverage outcomes also depend on when travel was arranged, whether the customer is already overseas, and the status of Department of Foreign Affairs and Trade (DFAT) travel advisories. Travelling after a “Do Not Travel” warning is likely to affect cover, but being diverted into a restricted country by an airline or as an unplanned stop does not automatically invalidate a policy. In those circumstances, claim decisions turn on the cause of loss and whether it is directly linked to the conflict. These details reinforce the advisory workload that NIBA has identified. Brokers are being asked to explain how war exclusions apply, interpret travel advisories, distinguish between conflict‑related and unrelated losses, and help clients understand product disclosure statements and known event notices.
In addition to airspace restrictions and on‑the‑ground security issues, the conflict is affecting cyber risk assessments. S&P Global Ratings has reported that the war, combined with wider geopolitical tensions, has increased the number of state‑linked or proxy cyberattacks aimed at critical infrastructure and essential services. According to S&P, cyber activity has included jamming and spoofing of global navigation satellite systems affecting commercial shipping in the region, with potential implications for trade flows through key maritime routes. In some marine segments, insurers have reconsidered or withdrawn certain forms of cover, showing how geopolitical events, physical disruption, and insurance capacity can interact.
S&P also notes potential tension between standard “act of war” clauses in cyber policies and the difficulty of attributing responsibility for an attack, particularly where state actors, proxies, and criminal groups may overlap. This could give rise to disputes over coverage while demand for cyber insurance continues to grow. These developments align with NIBA’s observation that geopolitical, cyber, and supply‑chain risks are increasingly interlinked. The Middle East conflict is acting both as a live claims event and as an example of how concurrent shocks test policy wordings, risk appetite, and advisory models across the market. NIBA’s report concludes that the coming years “are not something to simply anticipate; they are a future we will build together,” and says the profession’s response will depend on its ability to anticipate change, update operating models, and maintain its role in a more complex risk environment.
