By Jonathan Saul

LONDON (Reuters) – War risk insurance premiums for shipments to Israel are currently three times higher than a week ago as the conflict with Iran continues into its fifth day, industry sources reported on Tuesday.

The cost for a seven-day voyage to Israeli ports has increased to between 0.7% and 1.0% of the ship’s value, compared to around 0.2% the previous week. Despite this spike, war risk premiums remain below the peak of over 2% recorded in November 2023, following a Hamas attack that resulted in 1,200 fatalities and led to the Israeli invasion of Gaza.

Individual underwriters assess risk differently, which can add tens of thousands of dollars in daily costs to each voyage. According to David Smith, head of marine with insurance broker McGill and Partners, rates for voyages to Israel have been adjusted on a case-by-case basis, reaching as high as 1% for a 7-day call, influenced by factors like cargo, ownership, and the port of call.

Israel relies heavily on maritime routes for its imports, with key entry points being the Mediterranean ports of Ashdod and Haifa, as well as the Red Sea port of Eilat. Notably, Israel’s Bazan Group halted operations at its Haifa oil refinery on June 16 after its power station was damaged in an Iranian strike.

As of Tuesday, nearly 30 vessels, primarily general cargo ships, were anchored around Haifa’s bay, according to MarineTraffic data. However, all Haifa port terminals are still fully operational, as per an Israeli industry source.

The elevated risk profile has made many shipping companies hesitant to travel to Israel. The Iran-backed Houthis of Yemen announced they would target any Israel-linked vessels, despite having established a ceasefire regarding U.S. and UK-affiliated ships in the Red Sea. The militia declared a maritime blockade on Haifa port in response to the ongoing conflict in Gaza.