我问Gemini 2.5 AI：Can you write a short article on MARAD War Risk Insurance and its role if Taiwan is under a gray zone blockade by China?
Gemini 2.5 AI answer：
Here is a short article on MARAD War Risk Insurance and its potential role in a gray zone scenario.
MARAD's Lifeline: War Risk Insurance in a Taiwan Gray Zone Scenario
In the complex chessboard of modern geopolitics, a "gray zone" blockade represents a significant challenge. This is a coercive action, such as one China might impose on Taiwan, that stops short of a formal declaration of war. It might involve large-scale "military exercises" that encircle the island, the use of maritime militia to harass shipping, or cyber-attacks on ports—all designed to halt commerce without firing a shot.
In such a scenario, one of the most effective and immediate weapons is insurance. The global shipping industry relies on marine insurance, and in the face of such risk, commercial markets would react instantly. This is where a little-known but powerful U.S. government tool comes into play: the Maritime Administration's (MARAD) War Risk Insurance program.
What is MARAD War Risk Insurance?
The MARAD War Risk Insurance program is a federal "standby" insurance plan authorized by Title XII of the Merchant Marine Act, 1936. It is not active during peacetime.
Its purpose is to provide a government backstop when commercial insurance is no longer available on "reasonable terms and conditions" (a status known as non-A&R).
Standard marine insurance policies specifically exclude risks from war, strikes, seizure, and terrorism. Shipowners buy separate "war risk" policies to cover these perils. However, in a crisis, commercial war risk underwriters can either:
1. Issue a 7-day notice of cancellation for policies in the affected area.
2. Charge astronomical "additional premiums" for any ship willing to sail into the newly designated high-risk zone.
In a gray zone blockade, commercial insurers would almost certainly deem the Taiwan Strait uninsurable, effectively creating a "financial blockade" that stops all commercial shipping.
The Insurance Vacuum of a Gray Zone Blockade
A gray zone blockade of Taiwan would trigger an immediate insurance crisis.
• Market Flight: The London-based Joint War Committee (JWC), which designates high-risk maritime areas, would list the waters around Taiwan.
• Coverage Evaporation: Insurers and reinsurers, fearing catastrophic losses of container ships and tankers, would cancel their coverage.
• Economic Strangulation: Without insurance (for the hull, cargo, and crew), no shipping company will risk its multi-billion dollar assets. Ships would stop sailing to Taiwan, starving it of energy, food, and supplies. The blockade's goal would be achieved without a military confrontation.
MARAD's Role as a Strategic Stabilizer
This "insurance vacuum" is the exact trigger for MARAD's program.
With the approval of the Secretary of Transportation, the U.S. government could activate its Title XII authority. MARAD would then be empowered to issue its own U.S. government-backed war risk policies to ships.
This program is designed to insure:
• U.S.-flagged vessels.
• Foreign-flagged vessels that are deemed to be operating in the U.S. national defense or national economic interest (which could easily include allied ships carrying critical supplies, like semiconductors or LNG, to or from Taiwan).
By stepping in to fill the insurance void, MARAD's program would allow critical shipping to resume. It acts as a powerful non-military, economic counter-measure. This move would:
1. Undermine the Blockade: It would render the "insurance weapon" ineffective by providing a viable alternative for shipowners.
2. Signal U.S. Resolve: It would be a tangible, material sign of U.S. support for Taiwan's economy and security, all while remaining below the threshold of direct military intervention.
3. Maintain Supply Chains: It would ensure the flow of essential goods, preventing the economic collapse the blockade is designed to create.
In essence, the activation of MARAD's War Risk Insurance would not just be a financial transaction. It would be a strategic and geopolitical tool, a lifeline designed to fight a gray zone conflict with a powerful economic counter-move.
Would you like to know more about the specific authorities in Title XII of the Merchant Marine Act?
