25 March 2026 | Insight
With relatively little airline renewal activity taking place in Q1, there are few indications that underwriting sentiment has changed from where it left off in 2025.
But while sentiment for renewals hasn’t shifted, geopolitical events has brought disruption and uncertainty on war risk coverages. The situation is fluid and with changes happening on a daily basis, we seek to offer an indication of how the market is responding, what trends are emerging, and what airlines should anticipate as the conflict dynamics evolve.
Just as aviation war markets were beginning to stabilise following the UK court judgments on Russia/Ukraine losses, renewed geopolitical tensions have created significant volatility. The US and Israeli conflict with Iran and the Iranian retaliations, have created fresh uncertainty for underwriters and insureds alike.
Unlike recent conflicts where the risk footprint was more clearly defined, the current situation is affecting a wider operating environment. While the most acute exposures remain linked to operations in and around the directly involved territories, the perceived risk has extended across the broader region, which is new scenario for the aviation insurance market to navigate.
To date, we have thankfully not had any reported evidence of any significant aircraft losses attributable to this conflict (other than Iranian-owned aircraft), nor indications of the aircraft being “lost” as experienced during the Russia/Ukraine war. Owing to the nature of the conflict, however, the risk is real and crucially, unpredictable, with underwriters exhibiting mounting caution and concern.
Given the speed of developments and the unpredictability of potential escalation, insurers’ responses have been mixed, with some uncertainty over the most appropriate approach.
Several weeks into the latest phase of the conflict, a clear and consistent market strategy has yet to emerge. Even the threshold for what constitutes “a material change in the nature or area of the insured’s operations” has been debated within market groups.
One comparatively consistent theme, however, is that insurers have generally resisted issuing Notices of Cancellation (NOCs) to airlines operating in, or with assets located in, the region. Instead, many are looking to apply additional premiums for hull war and AVN52 cover, across primary hull and liability placements as well as excess AVN52 programmes, with approaches varying by carrier and portfolio.
In this environment, timely and accurate information is critical. Clients should ensure they provide their broker and, in turn, (re)insurers, with the most up-to-date route, frequency and asset-location information, including any contingency planning for rapid changes to flight paths or bases of operation.
Engagement with your broker can help minimise disruption, particularly where routes touch higher-risk airspace or where contractual obligations may require rapid redeployment. We suggest reviewing war-risk exposures, validating declared operations, and discussing how additional premium mechanisms may apply under different escalation scenarios.
Specific information required for clients who fly (or are planning to fly) into/out of the Middle East region will include, but is not limited to the following:
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