The entire Iranian oil tanker fleet traveling across international waters is now covered by domestic insurance companies, head of the Central Insurance of Iran said.
All Iranian tankers are covered by domestic protection and indemnity (P&I) insurances, and backed by the Central Insurance of Iran, Mohammad Ibrahim Amin was quoted by Shana news agency as saying on Monday.
Very Large Crude Carriers (VLCCs) are obliged by international maritime authorities to carry mandatory third-party liability insurance of a value up to $1 billion (P&I Coverage). This type of coverage is only offered by large insurance groups (P&I clubs), 90 percent of which are based in Europe.
EU sanctions against Iran have prevented European insurers from dealing with Iranian tankers, and this has partly affected Iran's oil exports, as without cover, its tankers cannot deliver the products.
Consequently, Iranian P&I club emerged and started to offer full cover and protection to the entire National Iran Tanker Company’s (NITC) fleet.
Some countries require issuance of guarantees in addition to P&I, in which case the minister of economy on behalf of the government signs required guarantees for the Iranian tankers to be allowed to enter certain ports, Amin noted.
These guarantees, which were previously valid for only a month, are now valid up to six months as a result of negotiations held between the ministry of foreign affairs and the ministry of economic affairs and finance.
Ports in China, Japan, India, and South Korea require such guarantees, issued by the minister of economy, the official said. "Iranian tankers carrying crude oil, petrochemicals, and gas condensates face no restriction with regard to insurance."
From a total of 29 insurance companies operating in Iran, two are P&I Clubs. They have agreed to provide insurance coverage and other services to Iranian tankers, with the Central Insurance of Iran "supporting them," Amin said without providing any further detail.
In January 2014, the EU amended its anti-Iran sanctions provisions, lifting its ban on the provision of insurance for tankers carrying crude oil from Iran. EU sanctions on the NITC were also annulled in October 2014, after the EU failed to appeal against a court ruling that ordered the measures to be lifted. However the company still remains on the US government's sanctions list.