Shipping insurers are canceling war risk coverage in Russia, Ukraine and Belarus from January, making freight and freight companies liable for large losses related to the ongoing conflict, reports The Guardian
At least 12 of the 13 Protection and Indemnity (P&I) clubs – which cover 90% of the world’s oceangoing vessels, including those from the UK and US – said they could no longer provide cover to customers because reinsurers were leaving the region due to financial losses.
Most ships buy P&I cover from the 13 clubs owned by the shipping companies whose fleets they cover to protect against risks such as collisions, property damage, pollution, environmental damage and wreck removal.
The cancellations, first reported by Reuters, mean it could be harder for shipowners or charterers to get insurance in the new year, leading to higher prices and some shipping companies choosing to either avoid the region or sail without cover.
It is the first time reinsurers have had the option to cancel cover for clients since Russia invaded Ukraine in February, as most contracts are on 12-month basis and will be renewed on January 1st.
