In the nearest future, large and loyal customers will change insurance companies where they have been served for decades.
Global insurers stopped providing coverage to Ukrainian offices of their Clients because of the war.
Before the war, the global insurer provided the Client with coverage in all countries where the Client had divisions. They issued a local insurance policy with reinsurance of 99% of the risk with a global insurer.
However, due to the war, insurers in Ukraine cannot have reinsurance contracts with foreign partners, and global market leaders are not ready to provide services in Ukraine
Global insurers advise to buy insurance at the local companies. Will it cause a boom in the market? Unlikely.
Global insurance companies may offer a higher coverage compared to local insurance companies. It is not easy for local insurers to place risks with insurance sums exceeding UAH 1 billion. Previously, they used foreign partners for this, but now international insurers cannot or do not want to interfere.
The National Bank limited foreign currency payments, including foreign currency payments for reinsurance services.
Aa an example. Let’s look at the insurance of grain passing through the maritime "green corridor". English underwriters Lloyds agree to insure even war risks for such cargoes taking into account that the buyers of grain from Turkey and the European Union require it. However, Ukrainian companies cannot pay for foreign reinsurance, which is why they are unable to offer their customers the desired product.
The author of the article is Vitaly Lebedovskyi
Source: Економічна правда
