Lloyd's of London backs US sanctions on Iran

http://www.telegraph.co.uk

Lloyd's of London has warned companies it will not longer insure or reinsure petroleum shipments entering Iran.

The world's largest insurance market said it would comply with sanctions signed by US President Barack Obama last week. These aim to limit the Islamic Republic's fuel imports and increase its international isolation.

The move is a further blow to Iran's economy with a number of oil companies, trading houses and other international businesses already complying with the US sanctions.

Sean McGovern, Lloyd's general counsel, said: "The US is an important market for Lloyd's... Lloyd's will always comply with applicable sanctions."

Meanwhile, Richard Ward, Lloyd's chief executive, has warned that insurance coverage for offshore oil rigs in the Gulf of Mexico is likely to rise between 15pc to 30pc after the BP Deepwater Horizon disaster.

Mr Ward told Bloomberg Television: "Prices will have to go up in the Gulf of Mexico. We've seen very low prices for covering these offshore installations over many, many years. People recognise that the risks they were pricing a while ago were underpriced and they need to restore pricing levels."

Lloyd's insurers were part of a syndicate that insured the rig owned by Transocean, which sank in April.

In May, the market said it was likely to pay out between $300m (£200m) and $600m in claims relating to the disaster - significantly less than the $3.6bn paid out after the explosion on the Piper Alpha oil platform in the North Sea in 1988.