Ukraine: cargo ships crossing the grain corridor face insurance crisis

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Nov 2022

On Tuesday, 1 November 2022, Russia has decided to suspend its involvement in the agreement allowing the safe export of Ukrainian grain through the Black Sea.

cargo ships As the risk of war is becoming greater, many insurers have decided not to underwrite policies to cover cargoes that would venture to use the corridor linking Ukraine, the 5^th largest wheat exporter, to the rest of the world.

Following Russia's announcement, Ascot, the Lloyd's of London syndicate, announced that it would stop underwriting any insurance policy for ships sailing in this area. On the same day, other Lloyd's underwriters adopted the same decision.

The few insurers who continued to cover other vessels against war risks raised their premiums by 50%. These premiums have gone from 1% of the value of the ship to 1.5%, a 50% increase in one day.

It is worth noting that on Wednesday, 2 November 2022, Russia has rejoined the corridor agreement, which should ease the situation and allow the old rates to be applied again.