The Lloyd’s of London insurer has committed to an intended coverage consortium for the purpose.
Hiscox has announced its commitment to a planned shipping insurance consortium that will offer coverage for ships moving through a safe passage corridor from Ukraine.
The Lloyd’s of London insurer faced notable first-half losses, sending its shares downward.
Ukraine has now finally had its first grain-carrying ship head out of its port since the start of Russia’s war there. This has occurred following a deal brokered by the United Nations and Ankara. The ship departed the coast of Turkey earlier this week and had an inspection the following day.
In July, the Lloyd’s Market Association trade body announced that they were forming a consortium for the purpose of providing grain shipping insurance for the shipments from the Ukraine corridor. As of the time of the writing of this article, the consortium was not yet finalized, according to Hiscox CEO and executive director Aki Hussain in a Reuters report.
Despite the fact that the consortium is incomplete, Hiscox is committed to the shipping insurance.
“We have committed our support to the Lloyd’s market-led initiative,” said Hussain. “We are very supportive of it.”
Ascot, another Lloyd’s insurer, and Marsh, a broker, have each also launched their own separate facility for providing as much as $50 million in coverage to shipments of grain originating in Ukraine.
Hiscox is among the biggest commercial insurance market participants at Lloyd’s. It had insured some of the ships trapped at the ports in Ukraine but has yet to receive any claims. According to Hussain, the losses Hiscox has incurred from Ukraine and Russia have totaled a net $48 million net of reinsurance. That represents a slightly higher figure than the estimate released in May, which was $40 million.
The insurer was the worst performer in the FTSE mid-cap index, having tanked by 7.6 percent, following the report of a $107 million pretax loss in the first half as a result of a sharp drop in its investment portfolio value. During the first half of 2021, the shipping insurance company had recorded a $133 million profit.