How Shipping Insurance Really Works During a War
Odd Lots
Bloomberg
4.5 • 2K Ratings
🗓️ 10 April 2026
⏱️ 53 minutes
🧾️ Download transcript
Summary
When the conflict with Iran started, some of the first headlines we saw had to do with shipping insurance. Marine insurers were said to be canceling war risk coverage for vessels going through the Strait of Hormuz. Premiums were said to surge. Meanwhile, the Trump administration announced it would offer its own insurance for ships traversing the Persian Gulf, in an effort to get things moving again. So why is insurance such a crucial part of maritime trade? And how does the system actually work? In this episode, we speak with Dorothea Ioannou, CEO of the American P&I Club, and Steven Ogullukian, the club's reinsurance director. We talk about the different roles of insurers, reinsurers, insurance clubs, and why ships need to have separate coverage for things like war, liability and hull loss.
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Transcript
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| 0:00.0 | Bloomberg Audio Studios. |
| 0:04.9 | Podcasts Radio News. |
| 0:08.0 | Hello and welcome to another episode of the Odd Thoughts podcast. I'm Tracy Allaway. And I'm |
| 0:22.4 | Joe Wisenthal. Joe, you know, I'm slightly obsessed with insurers. Maybe obsessed isn't the |
| 0:27.7 | right word, but fascinated, appreciative of insurers because I think there's a tendency to think |
| 0:34.2 | of them as sort of limiting factors in the world. |
| 0:40.6 | So, you know, if you can't get insurance in California, you can't build a house. |
| 0:44.4 | But I also think of them as enablers of certain behaviors, right? |
| 0:46.5 | I think that's a really good way to put it. People do a lot of things that they wouldn't otherwise do, were they not able to get insurance on it? |
| 0:53.4 | So, yes, it does cut in both directions. |
| 0:55.7 | So we should appreciate the existence of insurance. |
| 0:59.7 | All right. |
| 1:00.0 | Well, now... |
| 1:00.1 | Actually, you know what? |
| 1:00.7 | My daughter, actually... |
| 1:02.0 | Your daughter has insurance? |
| 1:03.7 | Well, she asked me to explain insurance the other day. |
| 1:07.0 | Which I was like, you know, and suddenly I was like, I have to explain insurance to. Wait, first of all, tell the listeners how old your daughter is. She's 10. I was trying. I can't remember the context exactly what it was. Maybe something about fire insurance, et cetera. But I think I was actually pretty proud of myself. I was basically like there are these risks that happen where like save your house burns down. You could like ruin you financially. |
| 1:28.5 | But it doesn't make sense to like save all that money in cash and always have that much |
| 1:34.0 | savings available to be able to rebuild your house. |
| 1:36.3 | And therefore the way you solve it is by paying a small amount. |
| 1:39.3 | I was pretty like happy. |
... |
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