Ukraine grain facility places first risk

The first risk under a new cover designed to protect grain shipments from Ukraine has been placed in the Lloyd’s market.

Broker Marsh and underwriter Ascot Group announced the first insurance placement for the new marine cargo and war facility. Launched earlier this month, the facility provides cover for Ukrainian grain and other vital food supplies being shipped through safe corridors established by the newly signed Black Sea Treaty between Russia and Ukraine.

Chris McGill, head of cargo, Ascot, explained: “We’re delighted to provide coverage to the first insured using this facility. Since its launch we have seen significant demand for the product from a number of clients and brokers. It’s great that this mission driven initiative is open and able to meet that demand for all who may need it.”

Ukrainian grain is relied on to feed tens of millions around the world and the Russian invasion and subsequent blockade of the Black Sea ports left millions of tons stranded.

In May Emerging Risks reported Lloyd’s was in talks with the |United Nations in an effort to create insurance cover for gain shipments should the UN succeed in brokering a deal to allow shipments to resume.

At the time the UN’s World Food Programme (WFP) executive director David Beasley warned the world was courting disaster.

“Right now, Ukraine’s grain silos are full,” he said. “At the same time, 44 million people around the world are marching towards starvation.

“We have to open up these ports so that food can move in and out of Ukraine. The world demands it because hundreds of millions of people globally depend on these supplies.”

“We’re running out of time and the cost of inaction will be higher than anyone can imagine,” Beasley added. “I urge all parties involved to allow this food to get out of Ukraine to where it’s desperately needed so we can avert the looming threat of famine.”

Marsh, Ascot and other insurers that are part of the facility have also agreed to extend it to clients of Lloyd’s registered brokers, in a move designed to provide added support to ongoing humanitarian efforts and alleviate continued pressure on supply chains and food security.

The marine cargo and war facility provides up to $50 million in all risks marine cargo and war coverage. The facility allows ships transporting grain, and other designated food products from Ukrainian ports, to have reliable and readily available coverage in place for their export voyages.

David Roe, head of UK cargo, Marsh, added: “Cargo and war insurance will play a pivotal role in the broader resumption of grain and other vital food exports from Ukraine’s Black Sea ports. By making the facility available to the clients of Lloyd’s of London registered brokers, it is our hope that we can all work together to support international efforts and help ensure Ukrainian grain reaches the world’s most vulnerable people during this terrible time of conflict.”

Ukrainian grain is relied on to feed tens of millions around the world and the Russian invasion and subsequent blockade of the Black Sea ports left millions of tons stranded.

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