The ongoing armed conflicts in Ukraine have caused significant losses in the insurance sector, particularly impacting the London insurance market. Specialized insurance areas such as aviation, marine, trade credit, and political risk have faced severe damages due to sanctions imposed on Russia. Marsh McLennan has proposed the establishment of a government-backed war risks insurance fund to aid in Ukraine’s reconstruction. UK Prime Minister Rishi Sunak announced a comprehensive financial package to support this initiative. However, the lack of reinsurance options and the reluctance of capital providers make it challenging for the insurance market to adequately cover these risks. With support from the World Bank, the Ukraine Financial Stability Council plans to implement mandatory war risks insurance for certain properties.
Source and Details: Kennedys Law