Reuters reports that Iran is in active talks with insurers to provide cover in a market valued at $9 billion last year, and potentially double that in the next decade.
This is despite the fact that Iran has secured ties with only a limited number of smaller banks as U.S. sanctions remain in force, following the removal of international banking restrictions in January.
A leading London sanctions lawyer says there is less caution relating to insurance contracts, as ” you have not had the big fines on the insurers that the banks have faced.”
Western companies need insurance in order to resume business with Iran; shipping and trade credit insurance are the first types of insurance being offered.
Deputy oil minister Amir Hossein Zamaninia has said European insurers now have no problems insuring Iranian oil tankers.
Protection and Indemnity (P&I) clubs – marine insurers owned by shipping firms – have started to provide cover for Iran’s shipping fleet, including its oil tankers.
Jonathan Andrews, a director of Britain’s Steamship Mutual, said it was insuring ships for the National Iranian Tanker Company (NITC), and also for Iranian cargo ship operator Islamic Republic of Iran Shipping Lines (IRISL).
Norwegian ship insurer Skuld said it was in discussions with IRISL, while it was already insuring NITC ships.
UK’s Standard Club said they were covering vessels trading to and from Iran, but did not say whether this related to Iranian shipping firms.
Germany’s state run export credit group Hermes has reportedly concluded about a dozen trade finance deals covering goods worth several million euros, while Italian export credit agency SACE has also undertaken its first small transactions with Iran, and France’s Coface has signed an agreement with Iran to guarantee trade finance on behalf of the French government.
Meanwhile, a senior executive at insurance group MS Amlin said Iran was “very high up the agenda … it’s going to be something for 2017.”
Reuters reports that other large insurers and reinsurers such as Hannover Re are looking closely at Iran, but say concerns about payments still prevent them from doing business there.
Swiss Re chief executive Christian Mumenthaler told the news agency: “We have big business in the U.S. and so our chief legal officer is basically regulating every micro-step we do in that direction.”
Lloyd’s of London had historically been active in Iran. Chairman John Nelson said it was a “market we would like to get back into, we have to just be clear, the U.S. sanctions are still very restrictive.”
FAR Law Firm