Marsh confirms Lloyd’s war risk insurance scheme for Ukraine exports

Lloyd’s underwriters have backed a new insurance scheme set up by Marsh and the Ukrainian government to provide war risk insurance to exporters of grain and critical food supplies from Ukraine’s Black Sea ports. Unity will provide up to $50m in “affordable” and “cost-effective” insurance covering hull and separate protection & indemnity war risk cover, Marsh said. Following reports earlier this week from Ukraine about a new war risk insurance discount arrangement with the UK, Marsh confirmed details of a public-private collaboration, which it said would enable critical food exports at scale. Unity has been established with the Ukrainian government and the Export Credit Agency of Ukraine with support from Ukreximbank, the State Export-Import Bank of Ukraine, and state-owned bank Ukrgasbank providing standby letters of credit, confirmed by DZ Bank. Marsh said the arrangement will offer shipowners and charterers war risk insurance in the absence of safe corridors. Marsh had previously launched the As One facility to provide insurance under the Black Sea Grain Initiative, in place for a year before Russia withdrew from the deal in July. Unity will be available to clients of registered Lloyd’s brokers. John Doyle, president and CEO of Marsh McLennan, said: “The launch of this insurance facility will especially benefit the developing nations that buy much of Ukraine’s grain and also help Ukraine’s future recovery and reconstruction endeavours.” Denys Shmyhal, Prime Minister of Ukraine, said: “The launch of the Unity facility will enable Ukraine to provide vital food supplies to the world at the same time as supporting the Ukrainian economy and keeping the Black Sea open for international trade. This partnership between the Ukrainian government, Marsh McLennan and Lloyd’s of London is a sign of confidence in our economy and demonstrates that Ukraine is open for business.” In social media posts earlier this week, Shmyhal said 14 UK insurers had backed a deal to provide war risk insurance discounts on exports using the Black Sea humanitarian corridor, with the news coming just days after a missile struck a cargo ship in an Odesa port. “According to the results of the agreements between the President of Ukraine Volodymyr Zelenskyi and the Prime Minister of Great Britain Rishi Sunak, Ukraine together with a pool of British insurance companies formed a special mechanism. It will allow a discount on the cost of insurance against war risks for exporters of all products from Ukraine,” Shmyhal said in the social media post. Following confirmation of the Marsh-brokered deal, Marcus Baker, global head of marine, cargo & logistics for Marsh, said: “The creation of this public-private partnership, with insurers working in tandem with the Ukrainian government and its banks, will accelerate the urgent resumption of vital grain exports amid the ongoing effects of this brutal conflict. Unity’s unique structure will enable underwriters to price risks at more affordable levels than those experienced in recent months.” Ukraine said 100 ships have sailed from Ukrainian ports to Africa and Asia since the launch of the Black Sea humanitarian corridor in August, transporting almost four tonnes of goods. Last week, the UN secretary general Antonio Guterres told Reuters that reviving a deal with Russia to ensure the safe transit of grain through the Black Sea would be “difficult”.

Marsh confirms Lloyd’s war risk insurance scheme for Ukraine exports

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