The U.S. once explored linking naval escorts through the Strait of Hormuz with government insurance——Financial Times UK

Investing.com — The UK’s Financial Times reported on Thursday that the Trump administration had considered a plan requiring ships escorting through the Strait of Hormuz to purchase insurance provided by the U.S. government.

President Donald Trump previously stated that Washington would provide insurance for commercial ships seeking to pass through this strategic waterway, as Tehran’s near-blockade of the strait has caused oil prices to surge.

Earlier this month, Washington’s international development finance agency, the U.S. International Development Finance Corporation, announced a plan to offer up to $20 billion in reinsurance to support ships passing through the strait, in coordination with naval escort.

The Financial Times reported that the government has been considering requiring ships seeking naval escort to purchase insurance under a program jointly operated by the U.S. International Development Finance Corporation and private insurer Chubb Insurance.

The Financial Times also noted that it is unclear whether the Trump administration will push forward with the mandatory aspects of the plan.

Citing insurance market sources directly involved with the U.S. International Development Finance Corporation, the FT reported that under the discussed model, ships seeking military escort through the Strait of Hormuz would be required to purchase insurance provided by the U.S. government for hull, machinery, and cargo.