The European Commission has sanctioned a significant €1.5 billion (PLN 6.4 billion) Polish initiative designed to bolster State-supported reinsurance for transport insurance within the territory of Ukraine. This approval aligns with EU State aid regulations.
Administered by Poland’s public export credit agency, KUKE, the scheme will provide reinsurance to address war-related risks. These include damages resulting from military actions, acts of sabotage, terrorism, uprisings, and riots, specifically for insurance companies offering transport coverage in Ukraine.
The European Commission highlighted that the scheme’s primary beneficiaries are insurers based in Poland, indirectly aiding Polish-registered transport firms that conduct operations in Ukraine. Eligible transport companies for the reinsurance coverage must either be registered in Poland or, if based in other EU Member States, have an established branch in Poland.
This strategic measure is intended to bridge a critical gap in war-risk insurance for transport companies affected by the ongoing conflict in Ukraine. The support is structured through public reinsurance, with KUKE covering 80% of war-related risks, while private insurers will manage the remaining 20%.
Insurance companies will remit the appropriate risk premium to KUKE, after deducting a commission fee for acquisition and administrative expenses. This ensures continuous and precise risk assessment and pricing. Notably, standard commercial risks associated with goods transport are excluded from this scheme. The initiative is scheduled to remain active until 30 June 2027.
Commenting on the scheme, Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition, stated, “The approved scheme will facilitate and sustain the transportation of goods between the EU and Ukraine, which has been disrupted due to the ongoing Russian aggression, while minimizing potential competition distortions.”
In related developments, Lloyd’s global insurance and reinsurance firm, MS Amlin, has pledged up to €110 million in reinsurance capacity over five years. This commitment supports war risk policies underwritten by three Ukrainian carriers, through a collaborative scheme with global broker Aon and the European Bank for Reconstruction and Development.
Yorum Yap