Escalating Regional Tensions and Their Impact on Lebanon’s Insurance Sector
By Labib Nasr*

The insurance sector in Lebanon has demonstrated resilience through multiple crises in recent years. Today, it is once again facing significant pressure due to escalating regional tensions, which are increasing overall risk exposure.

One of the most critical areas affected is marine insurance. Heightened geopolitical uncertainty around strategic maritime passages, including the Strait of Hormuz, has amplified concerns across global shipping and energy markets. As one of the world’s most vital oil transit chokepoints, handling approximately 20–25% of global seaborne oil flows, any disruption in this corridor has immediate repercussions on international trade and insurance markets alike.

In response, insurers and reinsurers have adopted a more cautious and selective approach. This has translated into:

• The withdrawal or restriction of marine war risk coverage in high-risk zones
• More rigorous and time-consuming underwriting processes
• Daily, case-by-case quoting with significantly increased premiums
• Reduced reinsurance capacity for war and political violence risks

This shift has extended beyond marine insurance. Across the region, insurers are exercising greater caution even in non-war-related lines, reflecting a broader reassessment of risk exposure in the MENA and GCC markets.

At the same time, concerns are growing around cyber risk and digital warfare, alongside the potential for large-scale losses driven by stranded vessels and risk accumulation in sensitive areas.

These developments are also impacting the local market. Economic uncertainty is placing pressure on premium collection, as clients face increasing financial constraints. In parallel, slower economic activity is affecting overall demand for insurance across multiple sectors.

Despite these challenges, Lebanese insurers continue to maintain strong relationships with international partners, working collaboratively to navigate this evolving landscape and ensure continued market stability.

*Labib Nasr
CEO of Lia Assurex s.a.l. | RDCL Board Member