Aon launches new €110m facility

Broker Aon has launched a new facility for the war risk insurance market in Ukraine.

The €110m (£91.3m) facility will support global reinsurance companies through a guarantee when covering specific war-related risks underwritten by local Ukrainian insurers.

This includes inland cargo, motor vehicle damage and railway rolling stock. The facility will expand to offer more coverage should there be market demand.

The facility, which has been launched in partnership with the European Bank for Reconstruction and Development (EBRD), comes after Aon found a significant reduction of reinsurance capacity available following Russia’s invasion of Ukraine in 2022.

Greg Case, chief executive at Aon, said: “Aon’s steadfast commitment to Ukraine compels our firm to continue to identify new opportunities for businesses to invest in the country during the ongoing war.

“This innovative new facility in collaboration with the EBRD further enhances the stability of the insurance market in Ukraine and strengthens the foundation for economic resiliency and growth.”

First partner

Reinsurer MS Amlin is the first partner to join the facility.

The structure allows MS Amlin to transfer reinsurance exposure off its balance sheet, enabling it to re-engage with Ukrainian insurers over war risk cover.

Martin Burke, chief underwriting officer at MS Amlin, said: “We are proud to support this innovative solution, providing much needed reinsurance capacity to help the domestic Ukrainian insurance market rebuild itself and support local businesses and clients.

“One could not find a better expression of our company purpose, providing continuity in uncertain times, than through our commitment to this scheme.”