By Cynthia Ezekwe
Following the exit of reinsurers from Russia, Ukraine, and Belarus, as a result of losses related to the lingering Russian-Ukrainian war, ship insurers have notified the insurance community of their cancellation of war risk cover in the regions effective from 1 January, 2023.
This was disclosed on the websites of some of the biggest protection and indemnity (P&I) insurers including American Steamship Owners P&I, North of England Protecting & Indem Assn, UK Mutual Steam Ship Assur Assn and West of England Ship Owners Mutual Ins Assn.
According to the UK P&I Club, the decision was spearheaded by retrocession– lack of availability of reinsurance for reinsurers,which was caused by the inability of the reinsurers to secure reinsurance for war risk exposure to Russian, Ukrainian or Belarus territorial risks.
American P&I club disclosed that it cancelled its insurance as a result of the notification it got from other reinsurers.
However, P&I insurance sources also remarked that the withdrawal of cover for Ukraine and Russia applies to some but not all types of policy offered by the P&I clubs.
Speaking on the decision,Stephen Rebair, deputy global director, underwriting at North of England Protecting & Indem Assn,said:”This is being driven by reinsurance, as reinsurers were limiting their exposure to the region and those exclusions have to be passed down the line.’’