The distinction between a covered loss and an uninsured one for businesses in the Middle East may hinge on a single word: war.
Many companies in the region have purchased insurance policies that cover terrorism or sabotage, but fewer have secured coverage explicitly for war-related events.
Trump has previously warned of intensified military action if a peace deal is not reached, adding to the uncertainty for businesses and insurers alike.
This discrepancy has emerged as a point of contention, with U.S. President Donald Trump recently dismissing the situation as not a 'war.' However, insurers with significant exposure to the region are treating the conflict as such, according to a report by CNBC.
The divergence in definitions could leave some businesses without financial recourse for losses incurred during the ongoing tensions.
The issue is particularly relevant as the conflict between the United States, Israel, and Iran continues to escalate.
Trump has previously warned of intensified military action if a peace deal is not reached, adding to the uncertainty for businesses and insurers alike.