The cost of ship insurance for routes between Asia and Europe may rise after Lloyd's of London was advised to treat piracy-prone waters between Yemen and Somalia as equivalent to a war risk.
The Joint War Committee, which assesses the threat to merchant shipping, added the entire Gulf of Aden, north of Somalia, to a list that already includes Iraq, Nigeria and parts of Indonesia, Neil Roberts, secretary for the group. Insurers are able to impose higher charges for routes with such a designation. Vessels sailing to the Mediterranean from the Middle East or Asia may be affected by the reclassification because the gulf lies to the south of Egypt's Red Sea, at the southern entrance of the Suez Canal. There were five pirate attacks near Aden in the first quarter, according to the International Maritime Bureau, the highest figure after Nigeria. The amendment to the war committee's list of danger zones was its first since August 2006.
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