dantheclammanFox & Friends co-host Brian Kilmeade tells oil tankers to go through the Strait of Hormuz: "Show some guts and go through that strait and do it"
CompactFlaxTrump is about to find out that ship owners won’t risk hundreds of millions per ship on an uninsurable voyage just to stroke his ego.
It’s not even just the price of a ship and cargo. Lead times are around 2.8 to 3 yrs for crude tankers and around 3.5 yrs for LNG carriers. That’s a long time to not be able to conduct business even if insurance did pay out. It is 100% rational to sit out a few weeks to figure out how to resume operations safely rather than trying to sneak through and hope for the best.
RobotToasterOddly, due to maritime law, it’s the cargo owners who would have to pay if the ship was only damaged but not sunk.
Alternatively wasn’t he floating some kind of mandatory insurance scheme? mandatory in the sense that the insurer can’t refuse. Sounds like a great time to liquidate some ageing stock for yhuge profits.
No. Reinsurance “scheme” lets an insurer transfer all risk. If US government is willing to pay the insurer $100M, then they will charge the ship $1M or $99M for the voyage, but keep $100M total. Brian Kilmede will not volunteer to be crew on the ships no matter the pay, either.
otterOh it is insurable all right.
You just have to pay what is called the “war premium”.
I bet they wouldn’t like what comes through the strait anyway.
Apparently the maritime insurance market writes about $1b per year, around .005% of hull value to 1-3% - which exceeds the profit margin.
Actuarial Warfare: How Seven Insurance Letters Closed the World’s Most Critical Chokepoint and Why Markets Are Mispricing Duration by 300%
Private Reinsurance, IRGC Fragmentation, Interceptor Depletion, and a Dead Nuclear Fatwa Have Produced a Crisis No Military Victory Can Resolve