Germany’s Munich Re and Allianz halted all remaining insurance business in Iran as their national representative body said it backed international moves toward tougher sanctions against Tehran.
Against a backdrop of rising political tensions, the world’s biggest reinsurer, Munich Re, said on Thursday it was stopping business with insurance firms in Iran, becoming the second major German company this year to cut ties with the country.
Siemens last month said it would wind down its operations there.
“A tightening of economic sanctions against Iran is understandable and will be supported by the German insurance sector,” industry body GDV said in a statement.
Iranian President Mahmoud Ahmadinejad this week said any country that tried to impose new sanctions on Iran would regret its actions, as the United States and Russia voiced shared concern about Tehran’s nuclear program.
German politicians have also turned up the heat, with Defense Minister Karl-Theodor zu Guttenberg this month saying the international community needed to make clear to Iran that “patience is at an end” in the nuclear dispute.
That message has resounded with the country’s insurers.
“Due to the political situation in Iran, Munich Re has decided to not renew existing business or write any new business with insurance companies there,” it said in a statement, adding that the decision would hit its premium volume by about €10 million ($13.52 million) annually.
U.S. politicians have pushed to suspend insurance coverage for gasoline shipments to Iran as a way of bringing Tehran to heel over its nuclear ambitions.
Munich Re stopped providing marine cargo reinsurance for oil product shipments last year.
Europe’s biggest insurer Allianz on Thursday said it too would no longer renew reinsurance business in Iran, adding that the volume was already negligible.
The move by Siemens last month found few followers among German companies, despite mounting pressure to sever links over the Islamic Republic’s sensitive nuclear work.
The GDV said it was following the intensifying discussions about Iran sanctions closely and demanded that the European Union take care that companies are not faced with conflicting sanctions requirements.
(Additional reporting by Christian Kraemer in Munich; Editing by Michael Shields, John Stonestreet)