In the political violence (PV) market, executives at Bermuda-based insurers and Lancashire Reinsurance said they expected claims from conflicts in the Middle East to outstrip premiums through the system, while noting the company had limited exposure to the region and saw opportunities to selectively underwrite new business.
During Lancashire Holdings Ltd.’s first quarter 2026 earnings call, chief underwriting officer Paul Gregory highlighted the significant political and economic volatility caused by the war in the Middle East. He pointed out that many professional businesses in Lancashire were exposed to the dangers of the region and war.
Gregory said the company currently has a limited presence in the Middle East and sees room for growth as demand for war coverage increases. However, Lancashire will underwrite new business in a cautious and rigorous manner.
“From an exposure perspective, our position is very manageable and we believe we are underweight in the region,” he said.
“Given this underweight position, it does provide us with the opportunity to underwrite new business as demand for war insurance increases. We are doing so in a prudent and thoughtful manner to manage our risk exposure while also maximizing any opportunities where we feel the balance of risk and reward is appropriate.
“So we will be selective but we are open to business and we will underwrite these risks and we have underwritten many more since the war began.”
Alex Maloney, chief executive of Lancashire Group, added that he expected losses from the system to exceed the premium in the PV market.
“You expect this to be completed within the year, which may impact some specialty reinsurance placements, the majority of which were completed on January 1.
“You would expect that in any category of business where claims exceed premiums, there should be some upward trend. Obviously the ongoing long-term situation in the Middle East means that people are going to have to re-underwrite these risks on a more reasonable basis,” Maloney said.