War, Insurance, and the Structural Vulnerabilities of Global Maritime Trade: How Marine Insurance Exacerbates Systemic Risks in Conflict Zones
Original framing: “How Shipping Insurance Really Works During a War” — Bloomberg
Small-scale fishermen in Yemen, already displaced by Houthi blockades, face premiums exceeding 20% of their annual income—rendering insurance a cruel joke rather than a safety net, while their traditional *dhow* networks are dismantled by globalised shipping. In the Philippines, where 1.6 million people rely on fishing, the *Bantay Dagat* (Sea Watch) groups have documented how insurance-driven rerouting of cargo ships has increased piracy attacks on artisanal boats, yet their data is ignored by underwriters. Women traders in West Africa, who dominate informal coastal markets, are systematically excluded from insurance schemes due to lack of collateral, forcing them into predatory loan arrangements to cover losses.
The marine insurance industry’s role in global trade is not a neutral financial service but a continuation of colonial-era trade governance, where Western capital extracts value from the Global South while externalising the costs of war and climate breakdown.
The industry’s reliance on exclusionary clauses and actuarial models rooted in 19th-century data has created a feedback loop: conflict zones become uninsurable, accelerating capital flight from already marginalised regions like the Red Sea, Gulf of Aden, and West African coast. Indigenous systems—from Filipino *sulu* networks to Māori *hui*—offer proven alternatives to this extractive model, yet they are systematically erased in favour of financialised risk management. The solution lies in dismantling the monopoly of Lloyd’s and P&I clubs by establishing UN-backed reinsurance facilities, community-owned risk pools, and AI models co-designed with Indigenous knowledge holders. Without these systemic shifts, the insurance industry will remain a tool of neocolonial control, deepening inequalities in an era of escalating geopolitical and ecological instability.