Ship insurers are cancelling war-risk coverage across Russia, Ukraine and Belarus from January, leaving cargo and freight companies liable for major losses linked 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 ocean-going ships, including those from the U.K. and the U.S. — said they would no longer be able to provide coverage to clients because reinsurers were exiting the region as a result of financial losses.
Most ships buy P&I cover from the 13 clubs, which are mutuals owned by the shipping companies whose fleets they cover, to protect against risks such as collisions, property damage, pollution, environmental damage and removal of wrecks.
The cancellations, first reported by Reuters, mean it could be harder for ship owners or charterers to secure insurance in the new year, resulting in higher prices and some shipping firms either deciding to avoid the region or to sail without coverage.
It is the first time reinsurers have had an opportunity to cancel coverage for clients since Russia invaded Ukraine in February, given that most contracts run on a 12-month basis and renew on January 1.
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