Impact of Iran-US Tensions on UAE Insurance Premiums

Mar 7, 2026

96 min

Mar 7, 2026 00:30

Will UAE insurance premiums rise if Iran-US conflict escalates further?

## Potential Effects on UAE Insurance

As tensions rise between Iran and the US, concerns about potential impacts on UAE insurance premiums are emerging. The conflict could disrupt shipping and air routes, affecting business costs in the region. However, a recent analysis by Moody’s Ratings suggests that the immediate impact on Gulf insurers will likely be limited.

## Short-term Outlook

Moody’s anticipates that any disruptions will be temporary, with the conflict expected to last only a few weeks. This means that insurers in the Gulf are not expected to face significant financial stress in the short term. Fitch Ratings also shares this view, noting that any closure of the Strait of Hormuz is likely to be brief due to its economic importance.

## Limited Claims Impact

War-related damages are typically excluded from standard insurance policies in the region, meaning direct claims from the conflict are expected to be minimal. Such risks are usually covered by specialist insurers in international markets.

## Investment Risks

The primary risk for insurers lies in their investment portfolios. Regional instability can lead to declines in asset values, particularly in equities and real estate. Moody’s estimates that a 20% drop in these valuations could reduce the total equity of rated companies by about 7%. Larger insurers are generally better positioned to absorb such losses due to their diversified portfolios and stronger capital buffers.

## Long-term Considerations

If the conflict persists, it could lead to weaker investor sentiment and a broader economic slowdown, potentially affecting insurance pricing. Moody’s warns that prolonged disruption could weaken premium growth, impacting the sector’s stability.

## Factors to Monitor

Key factors that could influence future insurance pricing include the duration of the conflict, stability of shipping and air routes, financial market performance, and economic growth in the GCC. For now, analysts expect the sector to remain stable, with any changes in premiums depending on the conflict's duration and economic impact.

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