(This story has been updated with comments from Cameron Berrington, Canada Marine Leader at Marsh)

The Panama Canal Authority's decision to reduce daily vessel transits starting September 15, due to low rainfall linked to El Niño, is the latest reminder that global shipping chokepoints carry risk insurers can't treat as one-off events, according to a source who leads a major marine underwriting practice at a global insurer, speaking to Insurance Business Canada on condition of anonymity.

The ACP said vessel transits will drop from 36 to 32 per day starting September 15, with additional restrictions phased in from September 3, as the authority works to preserve water resources amid what forecasters expect to be a particularly strong El Niño pattern this year. The canal, used by roughly 14,000 ships annually and generating close to $3 billion a year for Panama, has faced similar restrictions before, including a sharper cut in 2023 after the country recorded its driest October since 1950. This year's El Niño is expected by some forecasters to rank among the strongest on record, with effects on weather, food supply chains and broader economic activity likely to extend well beyond shipping alone.

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The disruption arrives as the industry is still absorbing the impact of the conflict around the Strait of Hormuz, which has already forced insurers to reassess exposure across multiple global trade routes rather than treating any single disruption as isolated. That reassessment, the source said, has increasingly meant looking at chokepoints as a category of risk rather than a series of unrelated, one-off events tied to a specific conflict or climate pattern.

The source said Panama has long been recognized within the industry as one of several chokepoints capable of disrupting global trade if conditions shift quickly, alongside other narrow, high-volume routes that carry the same underlying vulnerability.

Cameron Berrington, Canada Marine Leader at Marsh, said the Panama Canal restrictions fit the same pattern, disruption building simultaneously across several chokepoints rather than in isolation.

"Combined with ongoing risks around the Strait of Hormuz and the effective constraint on Red Sea shipping caused by Houthi attacks, it highlights just how vulnerable global trade remains to disruption at a small number of strategic passages," Berrington said.

The anonymous source pointed to the same set of vulnerable routes directly. "There are six main ones: the Panama Canal and the Suez Canal among them," the source said. "The Suez Canal has had conflict around it over the last 50, 60 years. There's the Strait of Malacca, too, that receives about 23 million barrels of oil per day."

That shared vulnerability, narrow passages with few practical alternatives and enormous volumes of trade running through them, is exactly why insurers have started treating chokepoint risk as a distinct category rather than reacting to each disruption individually as it arises.

"Insurers, logistics providers are now looking at alternative trade routes and saying, do we have the same exposures, and how do we protect them?" the source said.

Reduced Panama Canal capacity is likely to push some vessels toward longer routes around South America, additional transshipment by truck or rail across Central America, or added scheduling pressure on carriers already adjusting to disruption elsewhere in the world. Longer routes and rerouted cargo typically mean more time at sea, more handling points, and more opportunities for something to go wrong, all factors that feed directly into how marine risk gets priced.

Berrington said those cost pressures show up in concrete ways once a route like Panama tightens, including cargo owners paying for booked capacity vessels can no longer fully use.

"Reduced capacity and draft restrictions can drive delays, congestion, rerouting and added costs such as dead freight," Berrington said. "Those pressures can feed directly into underwriting and pricing decisions."

The source said this kind of pattern, sudden, hard-to-predict shocks forcing the market to react within days, has become almost routine rather than exceptional.

"It's going to happen again. It will," the source said. "Who would have thought four years ago, when we did our first mass cancellation of war and strikes, that we would be doing it again so soon? Nobody really thought about that."

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The source said the broader risk extends well beyond any single canal or strait, and that assuming today's disruption is contained to one region misreads how interconnected global shipping routes actually are.

"I think our trade lanes, all of them, are incredibly at risk," the source said. "I don't think it's going to stop."

Compounding the uncertainty, the source said, is how quickly capacity in the marine insurance market can shift once a route comes under pressure. Non-traditional insurers sometimes enter a market with aggressive pricing during calm periods, drawn in by the opportunity to grow premium quickly, only to pull back sharply once losses start to climb and the true cost of covering that risk becomes clear. When that happens, the source said, the consequences aren't contained to the insurer that overextended itself.

"We all live and die by the actions of one market," the source said. "If a competitor avoids risk-managing their portfolio and pulls out, we're all painted with the same brush."

That dynamic, the source added, is part of why chokepoint disruptions like Panama's current restrictions tend to have consequences that outlast the initial event itself, reshaping how routes are priced and underwritten long after the immediate cause has passed.