Dear Sir/ Madam,
With the war between Ukraine and Russia below is a detailed note of Insurance Advisory for Marine Policy, Credit Policy, etc. Kindly go through the same.
Beside detailed note following are major points –
- Marine cover- all new dispatches ——please share the details like value; final location; commodity; INCOTERM etc. and we shall seek permission from your insurer
- Credit – ECGC and other insurers – seek permission for new shipments even though MBEP or prior limits approved
Implications of Instability in Ukraine and Russia
As a continuous communication we would like to inform you about the impact of current ongoing scenario between Russia and Ukraine. Russia started a full scale invasion on 23rd February 2022. Consequently various geo political scenario may be changed. Russia will have to face impositions of trade & economic sanctions by US, UK, EU , United nation and many other nations.
Implications under Marine Insurance:
Imposition of various sanctions may prejudice your future coverage under marine policy due to inclusion of Russia in sanction exclusion and limitation clause by insurer.
As of now whatever is dispatched is held covered but new dispatches to Russia and Ukraine – to be seek permission from Underwriters.
Implications under Credit Insurance:
Russia’s invasion of Ukraine carries huge risks for a world economy that’s yet to fully recover from the pandemic shock. The two key points of vulnerability here are high inflation and jittery financial markets.
This political instability has compelled insurers to effectively stop/ restrict coverage for any new Credit or political risk exposure. Private insurers have now listed down Russia & Ukraine under Restricted Country list, even ECGC has degraded Russia rating from B1 to B2 as a restricted country.
Three Channels of Impact : Energy, Trade and Financial Sector
The financing situation of Russian corporates and banks would also suffer, increasing non-payment risks significantly. In the adverse scenario if Russia is cut off from the SWIFT (Society for Worldwide Interbank Financial Telecommunication) Russia would be left unable to pay for imports and to receive payment for exports.
Department of Commerce / DGFT has operationalized helpdesk to support and seek suitable resolutions to issues related to India’s International Trade with immediate effect. Detail of same is provided on their website.
Website URL : https://www.dgft.gov.in/CP/
Sanction present and future
The objective of sharing this information is to bring this to your cognizance for all new dispatches to/from Russia and Ukraine and kindly intimate us in advance to seek advance approvals from Insurers.
Thanking You,
BEACON INSURANCE BROKERS PVT LTD