Ukraine war (re)insurance losses could eclipse impact of September 11
Potential political violence (re)insurance industry losses from the war in Ukraine could eclipse the impact of the September 11 terrorist attack in New York in 2001.
The Property Claim Services (PCS) is painting a bleak picture of the impact of the war in Ukraine with their predicted loss to specialty lines of insurance and reinsurance from a low-end estimate of Euros 13.3 billion ($13.05 billion), to more than Euros 23.6 billion ($23 billion).
The company said:“ Ukraine has the potential to become the largest industry-wide insured loss, across all classes of business, in history, even exceeding that of the terror attacks of September 11, 2001.”
Political Violence insurance provides cover for assets exposed to war, terrorism and related perils typically excluded from traditional policies. With massive losses projected for the insurance industry there is potential for numerous litigation battles triggered by the war which could help clarify policy terms and conditions.
PCS warns it could take months after any cessation of hostilities for loss adjusters to gain a clearer picture of the losses that are coming for the industry. PCS is working off estimates of: Euros 10.3 billion ($10 billion) for aviation; Euros 5.1 billion ($5 billion ) for marine; Euros 2.57 billion ( $2.5 billion) for energy; Euros 3 billion ($3 billion) for property per risk; and the Euros 103 million ($100 million) for personal and SME property.
Legal battles have already started with Dublin based AerCap, the world’s largest aircraft leasing firm which has assets trapped in Russia, launching a law suit in London’s High Court in an attempt to establish if a Euros 3.51 billion ($3.5 billion) insurance claim falls under its all-risk and war policy.
The war has also focussed attention on Political Risk Insurance, Cyber insurance, Trade Credit Insurance, Marine Cargo Insurance, Supply Chain Insurance, Directors and Officers (D&O) Coverage and Commercial Property Insurance.
As a result of these concerns policyholders are being urged to check the extent and limitations of their insurance cover and to seek specialist advice to limit future disputes.
W Denis place insurance around the world and have direct access to Lloyd’s as well as other international (re)insurance markets, if you wish to discuss your insurance requirements, please visit www.wdenis.eu or contact Vida Jarašiūnaitė firstname.lastname@example.org or Mark Dutton email@example.com