As the Middle East war continues there are new concerns that the conflict has brought the threat of cyberattacks back into the spotlight.

In a new report S&P Global Ratings believes that there is a heightened risk of severe cyberattacks during or following the military action, as has been observed in previous geopolitical conflicts.

Cyber-risk analytics firms have reported heightened activity among threat actors and affiliated hacktivist groups since the outbreak of the Middle East war. This includes distributed denial-of-service attacks, phishing campaigns, and attempts to compromise corporate networks and critical infrastructure.

To date, there have been no public reports of large insured cyber-related losses directly attributable to the Middle East war. Most incidents appear to have disrupted services or systems without generating significant insured losses. However, while the war’s impact on insurers’ cyber portfolios currently appears limited, the situation remains fluid and could escalate further, especially once the physical warfare concludes.

S&P added: “An escalation of malicious cyberactivity into larger, coordinated, state-linked attacks could severely test underwriting models, raise accumulation risk, and spark legal disputes over coverage. That said, insurers have been refining their cyber policy wording over the past few years, particularly around war-related exclusions and state-sponsored cyber activity, in order to clarify the coverage boundaries. At the same time, underwriting frameworks increasingly incorporate cyber-risk analytics, threat intelligence, and geopolitical risk assessments to better understand systemic exposure.”

“Our focus remains on insurers’ risk management practices, portfolio diversification, and operational resilience,” said S&P Global Ratings credit analyst Manuel Adam. “Overall, the Middle East war highlights the growing interconnection between cyber risk, geopolitics, and insurance, reinforcing the importance of clear policy language, prudent underwriting, and robust operational safeguards to maintain portfolio resilience.”

The cyber threat was highlighted as Moody’s Ratings  said  the conflict is amplifying tail risks for global specialty insurers, particularly across marine, aviation and political violence lines.

The report’s Key findings include:

Losses will remain contained for large, diversified insurers under Moody’s baseline scenario.

Specialty insurers are facing a higher likelihood of severe but low-frequency claims as missile and drone attacks disrupt key transport corridors in the Gulf region, including the Strait of Hormuz.

Marine and aviation traffic has been reduced, prompting insurers to reprice or restrict cover, while demand – and pricing – for political violence and terrorism (PVT) insurance has risen sharply.

Moody’s expects large insurers and reinsurers to absorb losses thanks to disciplined risk selection, aggregate exposure limits and reinsurance protection. War exclusions also provide some insulation, though these are likely to face legal challenges in certain cases.

Marine insurance faces elevated tail risk as vessels become exposed to damage, detention and potential “blocking and trapping” claims if transit through the Strait of Hormuz remains disrupted.

Aviation insurers also face heightened exposure, particularly to aircraft on the ground at major regional airports, though we note that insurers retain the ability to reprice risk quickly if conditions deteriorate.

“There is growing legal uncertainty around PVT and strikes, riots and civil commotion (SRCC) cover, where distinctions between war, terrorism and civil unrest are often contested,” the report added. “Rising demand for this cover supports insurer revenues but also increases exposure if the conflict escalates further.”

It continued: “The duration of the conflict remains a key risk factor, with prolonged hostilities increasing the probability of more complex and aggregated loss scenarios.”

Moody’s explained: “Our baseline scenario is that the conflict will be relatively short-lived, likely a matter of weeks, and that navigation through the currently blocked Strait of Hormuz (SOH), a key transit route for oil tankers, will then resume at scale.

“We expect losses to be manageable for large, diversified insurers in this scenario thanks to their careful risk selection, aggregate claims limits and reinsurance protection. War exclusion clauses will also provide some insulation, although these will likely face legal challenges in some cases.

“The duration of the conflict is an additional risk factor, with longer hostilities increasing the likelihood of larger and more complex loss scenarios. The concentration of high-value assets in the Gulf region increases the potential for loss accumulation relative to other recent episodes of increased geopolitical tension, such as Russia’s invasion of Ukraine.”

Then war is increasing the exposures with one expert saying insurers are reinsurers are already discussing the way forwards.

Ben Rose, co-founder and president of reinsurance intelligence company, Supercede,  commented: “Reinsurance is essential to a functioning insurance market, but it is not a blank cheque. Carriers will not ignore the true level of risk simply because cover is available or cheaper: they have brands and long-term customer relationships to protect. In practice, an underwriter’s price is a significant bellwether for the market – if cover becomes prohibitively expensive, that is a prompt to ask whether the activity remains safe or sustainable.

“Two weeks in, insurers will have done the work to see where reinsurance structures will protect them, and where they won’t. In a world that can seemingly change overnight, they will be reminded how important it is to have reliable data at their fingertips. Likewise, reinsurers will be carefully assessing the broader economic fallout to understand how changes to global growth, inflation and interest rate trends may impact their portfolios and investments, respectively. For now, the macro-factors are taking centre-stage, but the longer the conflict continues, the greater the risk that Iran hits something big, tall or expensive.”

The cyber threat was highlighted as Moody’s Ratings  said  the conflict is amplifying tail risks for global specialty insurers, particularly across marine, aviation and political violence lines.