Request for insurance cover soars as Middle East unrest spreads
Insurers have been inundated with requests for cover from rich individuals, oil traders and multinationals in North Africa and the Middle East amid fears that civil unrest will spread further.
Andrew Brooks, chief executive of Ascot Underwriting, a Lloyd's of London insurer, said the company received nearly 40 enquiries from the Middle East region in last week.
He said: "Ascot has seen a substantial up-tick for insurance enquiries in the Middle East. Initially, these were mainly from individuals trying to protect their personal assets such as fine art and property in Egypt and Bahrain, but as the unrest has spread into Libya, we have seen oil companies and oil traders enquiring about the availability of insurance products to protect their assets."
He told that one person in Cairo wanted extra cover for an art collection, worth three million dollars, The Guardian reports.
Some oil traders in Libya fear the stock being seized as the country faces civil war. Few oil and gas companies want forced abandonment cover for their mobile equipment, such as rigs.
Brooks also said: "Some insurance companies only look at aggregation on a country-by-country basis, but now all markets will have to look at cross border exposure."
Ascot's chairman, Richard Dearlove, said the security situation posed the most severe challenge since 9/11.
He said: "The potential for those accustomed to benign market conditions to take losses on a scale not seen since the period after 9/11 will be severe. A shake-up in the insurance market, which is overdue, looks imminent."
Head of Global Response at insurer Hiscox Stephen Ashwell believe that the cost of insurance premium will soar.
He said: "Last week we had a queue from our box at Lloyd's that stretched all the way down Lime Street. I haven't seen such an upsurge in business since 9/11."
The executive director of brokerage Willis' Global Markets International division Alex Clayton said that insurance rates are "definitely going up" and the enquiries from Bahrain had doubled, especially from hotel and shopping mall operators.
Source: ANI
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