Potential disruptions in Persian Gulf shipping lanes may drive up global marine insurance premiums, prompting Rep. Joey Salceda of Albay, Philippines, to advise local trade and maritime agencies to assess the impact on Philippine cargo, even for shipments routed outside the conflict zone.
In a statement issued on June 15 and reported by Manila Bulletin, the Albay 2nd District representative called on the Maritime Industry Authority (Marina) and the Department of Trade and Industry (DTI) to track insurance trends and determine whether rising surcharges could affect the cost of critical imports.
Salceda also raised the possibility of government support if shipping insurance costs escalate due to geopolitical tensions.
“Marine insurance premiums may also rise,” Salceda said. “If global insurers designate Gulf routes as war risk zones, freight rates on oil and food cargo may increase.”
He noted that the effects could extend beyond vessels passing through the Persian Gulf, pointing to possible adjustments in global reinsurance pricing. Such shifts, he said, may raise the overall landed cost of Philippine shipments, regardless of their specific routes.
Over the weekend, international reports indicated that Iran is considering closing the Strait of Hormuz, the only marine entryway into the Persian Gulf. The strait is a strategic passage for global oil and commodity trade and any restriction may trigger immediate changes in marine insurance risk assessments.
Salceda urged Marina and the DTI to factor these developments into their operational plans and to propose dedicated budget lines for monitoring and response efforts. “The Maritime Industry Authority and the Department of Trade and Industry should account for this in their operational planning and propose budget lines for monitoring and response,” he said.
The potential changes in insurance classifications and premium charges, according to Salceda, are relevant to the country’s trade activities, especially those involving essential goods that rely on stable shipping costs.
Should Philippine agencies prepare for rising global insurance costs even if local shipments avoid conflict zones? Share your thoughts in the comments.
