The London insurance sector is preparing to cover Ukrainian grains and fertilizer shipments through a secure corridor, voyages that may need up to $50 million of insurance coverage per cargo, industry sources involved told Reuters. London’s marine insurance market has placed the Black Sea region on its high-risk list and insurance costs have soared.
For each voyage, every ship will need separate layers of coverage, including for the cargo and for the ship itself, known as hull and machinery cover. An additional premium is also charged by underwriters for entering such areas.
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Lloyd’s insurer Ascot and broker Marsh have launched a facility for grain traders to provide up to $50 million in cargo cover for every voyage, Marsh’s global head of marine and cargo Marcus Baker said. “We have had some enquiries in the last couple of days and we fully expect that to gain traction,” he told Reuters, adding $50 million was more than enough for most grain shipments.
While there were issues to be resolved related to the corridor and the ports, Baker said: “The fact we have this in place means when it does happen, we can get moving.” He declined to comment on pricing but said the facility would include a “no claims bonus” – a refund for a voyage without mishap. He also said other insurers could join Ascot in providing the coverage.
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