DFC Unveils $20 Billion Reinsurance Plan for Maritime Risk in the Gulf
Earlier this week, the U.S. International Development Finance Corporation (DFC) and the U.S. Department of the Treasury unveiled a plan to deploy maritime reinsurance, including war risk, in the Gulf region.
The initiative aims to safeguard the continued flow of trade through the Strait of Hormuz. The DFC reinsurance facility will insure losses of up to $20 billion on a rolling basis, with the revolving insurance applying only to vessels that meet the criteria. Initially, the facility will focus solely on hull & machinery and cargo.
Chubb, a global leader in property & casualty insurance, including political risk and maritime insurance, will act as the lead underwriter issuing policies for eligible vessels.
“I am grateful to President Trump and Secretary Bessent for their support and approval of DFC’s plan to restore confidence in maritime trade and stabilize international markets,” said Ben Black, CEO of DFC.
“Working alongside U.S. Central Command (CENTCOM), DFC coverage will offer a level of security no other policy can provide,” he said. “We are confident that our reinsurance plan will get oil, gasoline, LNG, jet fuel, and fertilizer through the Strait of Hormuz and flowing again to the world.”
In recent days, the cost of insuring a ship sailing through the Strait of Hormuz has “soared 12-fold, even after Donald Trump vowed to backstop trade through the key oil chokepoint,” according to the Financial Times, which said shipowners have been quoted millions of dollars for cover to cross the strait or sail in nearby high-risk waters.
Meanwhile, Lloyd’s of London told the paper it will “still provide cover to basically anyone who asks” after criticism over the cancellation of war risk on certain policies and price increases for ships stuck in the Gulf.
Data from the marine analytics firm IMF Portwatch suggest that about 30,000 ships transit the strait per year, amounting to 82 per day. However, that number has dwindled to only a handful per day after Iran’s move to close the 24-mile stretch of water, leaving more than 150 ships stranded since March 1, according to hormuzstraitmonitor.com.
As the war in Iran and the wider region escalates, three more vessels have been hit by “unknown projectiles” in the Strait, maritime security and risk firms said on Wednesday, bringing the number of ships struck in the region since the Iran conflict began to at least 14.
In an effort to keep trade moving, some ships have resorted to “going dark” to pass the area, which involves switching off their tracking systems to avoid detection.
Roughly a fifth of the world’s oil and liquefied natural gas passes through the Strait of Hormuz. Disruption to trade flowing out of the Persian Gulf has caused oil and gas prices to fluctuate.
On Wednesday, the U.S. national average for gas ticked up to $3.57 per gallon, according to AAA data, roughly 75 cents higher than at the beginning of 2026. Meanwhile, the price of a barrel of Brent crude, the international standard, got as high as $101.59 overnight on Wednesday before pulling back to $100.44, a 9.2% rise.
In an effort to restrain fluctuating oil prices, the Paris-based International Energy Agency (IEA) on Wednesday recommended the release of 400 million barrels of oil from its reserves, the largest such move in its history, to meet demand and reduce pressure on the supply chain.
Will Jones is IA editor in chief.
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