According to gCaptain, which characterizes itself as “The world’s top-visited maritime news website,” Lloyd’s and other insurers are canceling or repricing insurance for the Strait of Hormuz to such an extent that the global financial system might not be able to survive the shock.
“Major marine insurers just cancelled war risk coverage for the Strait of Hormuz. 150+ ships stranded. Rates tripled. One seafarer dead. And this is only day 3 of the Iran conflict.”
Later on, founder John Konrad posted a longer text on X, explaining how the system is dependent on Lloyds and how the connections between Lloyds and MI6 work.
“This is potentially the biggest Iran story nobody is talking about: the global insurance market may be heading toward a systemic crisis. Here’s why…. Most people don’t realize London isn’t just a financial center it’s THE center of global insurance. Lloyd’s underwrites ~40% of the world’s marine cargo. Ship sinks, port gets bombed, canal gets blocked and the bill lands in London. This is why the UK punches above its weight. Not the Royal Navy. Not diplomacy. Insurance. Control insurance, control trade. And London doesn’t just control the 90% of global trade that moves by sea. Lloyd’s and the London market are major insurers of almost everything: skyscrapers, factories, ports, satellites, entire supply chains. You can’t participate in public markets or raise large amounts of capital without insurance.”
Konrad poses the question of how “London has maintained a stranglehold on global insurance while losing nearly [every] submarket related to ships. The answer: better intelligence. It is no coincidence that MI6 headquarters sits directly across the Thames from the IMO HQ, the world’s maritime regulator and a short distance from Lloyd’s itself. I have no proof of a direct pipeline, but it has long been speculated in the industry that intelligence flows from MI6 to Lloyd’s. Having the best intel in the world would be the single greatest competitive advantage any insurer could possess: the ability to price risk that competitors can only guess at. Here’s the problem: the majority of MI6’s intel doesn’t come from its own agents. It comes from Five Eyes the alliance comprising the US, UK, Australia, Canada, and New Zealand.
“Most large insurers worldwide don’t do independent intelligence work. They index off Lloyd’s rates. If you’re insuring a skyscraper in Tokyo, a semiconductor fab in Taiwan, or a port in Argentina you get a Lloyd’s quote, then shop that price around. Other insurers see Lloyd’s number and assume the diligence was done. They price accordingly. This means if London is suddenly flying blind it’s not just Lloyd’s policyholders at risk. It’s the entire global reinsurance chain. The cancellation of war risk coverage on ships isn’t the crisis. It’s the canary. If this hypothesis is correct, we could be looking at a systemic repricing event across global insurance markets…. the kind of cascading uncertainty that defied 2008 and COVID. Watch Lloyd’s. Watch reinsurance spreads. What Five Eyes. That’s where this story, and possibly Wall Street, breaks.”
Not to fear, President Trump has swung into action, posting on Truth Social: “Effective IMMEDIATELY, I have ordered the United States Development Finance Corporation (DFC) to provide, at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade, especially Energy, traveling through the Gulf. This will be available to all Shipping Lines. If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible. No matter what, the United States will ensure the FREE FLOW of ENERGY to the WORLD.”
