Tensions surrounding the escalating conflict involving the US, Israel, and Iran have begun to ripple through global insurance markets, with insurers rapidly reassessing risk exposures linked to shipping, trade, and cyber activity. In recent days, reports have indicated that some marine insurers have raised premiums or withdrawn coverage for vessels transiting the Strait of Hormuz, reflecting growing concern that the conflict could disrupt one of the world’s most strategically important energy corridors.
According to GlobalData’s latest poll run on Verdict Media sites in Q3 2025, industry insiders believe cyber insurance will be the commercial insurance product that sees the highest increase in demand due to geopolitical tensions. The poll found that 27.4% of respondents selected cyber insurance as the product most likely to experience rising demand, suggesting that concerns around digital security risks are intensifying across the insurance sector.
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Cyber insurance ranked ahead of political risk insurance (25%), supply chain insurance (23.8%), and business interruption insurance (13.1%). The results indicate that many industry participants believe cyber threats have become the most-pressing emerging risk for businesses operating in an increasingly-volatile geopolitical environment. The growing digitisation of economic activity, combined with the rise of state-linked cyber operations, has elevated cyber exposures beyond more-traditional geopolitical risks, such as political instability or trade disruption.
Recent developments in the Middle East further illustrate how geopolitical conflict can influence insurance markets across multiple lines of business. Reports published indicated that several maritime insurers had suspended war-risk coverage for vessels entering the Persian Gulf and surrounding waters, while premiums for ships passing through the Strait of Hormuz have risen as underwriters reassess the heightened threat environment. At the same time, the US Development Finance Corporation has signalled its readiness to extend political risk insurance and guarantees for maritime trade, particularly energy shipments moving through the Gulf, while the US has indicated that naval escorts may be deployed to protect tanker traffic.
While geopolitical tensions have historically driven demand for marine war-risk and political risk insurance, the broader risk environment increasingly includes a digital dimension. Escalating conflict in the Middle East could lead to increased cyber activity targeting businesses and critical infrastructure in Western markets, including the UK. As a result, rising geopolitical instability may reinforce expectations within the insurance industry that cyber insurance demand will grow more rapidly than other commercial lines, as businesses seek protection against both direct cyberattacks and digitally enabled geopolitical retaliation.
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By GlobalData
