Iran’s Ministry of Economy is reportedly advancing a proposal to manage the Strait of Hormuz through an insurance-based framework aimed at enabling post-war oversight of the strategic waterway in accordance with international law, while also creating a new source of revenue for the country.
According to a document obtained by Fars News Agency, the initiative seeks to establish a mechanism through which “management of the Strait of Hormuz becomes possible via insurance,” in a way that would remain acceptable to foreign states under non-war conditions while still allowing Iran to exercise effective control over maritime activity in the strait.
Under the proposed framework, Iran would gain broader oversight capabilities, including expanded access to maritime data and the ability to distinguish between vessels from different countries transiting the waterway.
Since the onset of the US-Israeli war, Iranian officials have maintained that “security of the Strait of Hormuz lies with the armed forces of the Islamic Republic.” Against that backdrop, the proposal argues that management of the strait should remain under Iranian authority due to the damage Tehran has sustained from the passage of hostile vessels through the corridor.
The document further argues that, from the standpoint of international law, imposing direct transit tolls on vessels in the post-war period could carry significant political repercussions.
Under such circumstances, Iran’s role in the strait would likely be limited to providing maritime services, which the report estimates would generate no more than $2 billion annually even under optimal conditions. It also notes that infrastructure limitations would restrict the profitability of such a model.
By contrast, the insurance-based approach is presented as a fully civilian mechanism that could prove more internationally acceptable than direct levies or transit fees.
Under the Ministry of Economy’s proposal, Iran would be able to issue a range of maritime insurance policies as well as financial liability certificates linked to passage through the Strait of Hormuz.
The plan would reportedly begin with insurance coverage related to inspection, seizure, and confiscation risks. Although such policies would not compensate for damage caused by weapons strikes, supporters of the initiative argue that the relatively limited exposure could still generate revenues exceeding $10 billion for Iran.
Medi Mohammadi, a trade expert at the Resistance Economy Think Tank, claims that the proposal remains incomplete due to the highly monopolized nature of the global marine insurance industry, where Iran currently holds limited influence. He also warned that vessels insured solely through Iranian providers could face the risk of rejection at international ports.
However, Taha-Hossein Madani, head of the Smart Governance Think Tank, said the framework could be implemented through reinsurance arrangements involving Russian and Chinese firms. According to Madani, ships could obtain the proposed coverage as a supplementary policy attached to their primary insurance contracts.
On May 8, the head of Iran’s Parliamentary National Security and Foreign Policy Committee, Ibrahim Azizi, said a draft bill aimed at defining the legal framework for the Strait of Hormuz has been finalized. The legislation is expected to be passed swiftly once parliament resumes its work, with officials describing it as a “deterrent law".
He added that multiple meetings had been held with relevant bodies, including the Ministry of Foreign Affairs and the Ports and Maritime Organization of Iran, in preparation for the bill.
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