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  • Results of Yuliia Svyrydenko's visit to London: UNITY insurance extended to all vessels carrying non-military cargo
    Ministry of Economy of Ukraine, posted 01 March 2024 14:44

    The UNITY Facility of affordable ship insurance, implemented by Marsh McLennan and Lloyd's of London in cooperation with the Government of Ukraine, is being significantly expanded. The program will now cover not only the maritime transportation of grain and other important foodstuffs, but also vessels carrying all non-military cargoes, such as iron ore, steel and containerized cargo. The decision, which will expand Ukraine's export opportunities, was announced on March 1 in London during a visit to the UK by a Ukrainian delegation headed by Yuliia Svyrydenko, First Deputy Prime Minister and Minister of Economy of Ukraine.

    "The coverage of all non-military cargo, such as containerized cargo, iron ore, and steel, is extremely important for Ukraine. Especially given the increased opportunities for exporting metallurgical products, as this sector has been severely affected by the full-scale invasion. In 2023, compared to 2021, steel production in Ukraine decreased by 3.4 times, while exports of metallurgical products decreased several times. Ship insurance can also support our efforts to increase exports of all non-resource products. Since strengthening the processing industry and developing non-resource exports are priorities for the Government to strengthen economic resilience," said Yuliia Svyrydenko.

    According to Yuliia Svyrydenko, thanks to the UNITY insurance tool, insurance rates in the commercial market have been halved. The rate under UNITY is currently 0.75% for agricultural products.

    "Marsh McLennan is committed to supporting Ukraine - helping it attract global investment to rebuild the country and its economy. We are pleased to expand our public-private partnership with the Ukrainian Government. The decision will provide exporters with lower premiums to ship a wider range of goods through the Black Sea trade routes and great economic benefits for Ukraine," said John Doyle, Marsh McLennan Group President and CEO.

    John Neal, CEO of Lloyd's, added: "Since the invasion of Ukraine, Lloyd's has been working with the UN, governments, regulators and insurance companies to support the economy and supply chains despite the challenging circumstances. New public-private partnerships, including the expansion of the UNITY program, are a signature of the Lloyd's marketplace, bringing insurance experts and policy makers together to tackle complex risks."

    The UNITY insurance instrument is available to all international brokers who can be contacted by ship owners and Ukrainian exporters.

    The UNITY program, which aims to provide affordable insurance against war risks for the supply of grain and other important food commodities around the world, was launched in November 2023. UNITY offers hull insurance and separate protection and indemnity (P&I) against war risks at significantly reduced premiums compared to standard market prices. In addition to grain, UNITY now provides coverage for other Ukrainian exports, including iron ore, steel, electrical equipment, and animal feed.

    Developed following a meeting between President of Ukraine Volodymyr Zelenskyy and Prime Minister of the United Kingdom Rishi Sunak, the UNITY Facility for reducing the cost of shipping insurance in Ukraine's territorial waters provides, among other things, for the creation of a fund to compensate the first part of losses to shipowners and charterers by issuing standby letters of credit confirmed by the German DZ Bank by state-owned Ukrainian banks Ukreximbank and Ukrgasbank.

    Lloyd's of London underwriters, led by Ascot, and other insurance companies are providing up to USD 50 million of hull and P&I insurance against war risks. UNITY is available to clients of all registered Lloyd's of London brokers, providing additional support for ongoing humanitarian efforts and helping to mitigate the aggressor's pressure on supply chains and global food security.