Kathmandu. Amid the ongoing conflicts in Ukraine and the Middle East, the demand for war risk insurance has increased globally.
In November, a Russian missile damaged Natalia Grisco’s apartment in a tower block on the outskirts of Kyiv. Luckily, she was safe. “The missile fell about 100 meters (328 feet) away from the building,” said Grisco’s daughter Elena Kalcheva. ’
Grisco was definitely very frustrated and crying at first. Peace was finally found. Because she had insured the apartment from such an attack. “Although regular household insurance doesn’t cover damage from conflict, whether you live in Ukraine or in another country that was not attacked,” Elena says, “My mother had the foresight to have special war risk insurance.” Now, the insurance company has paid $1,000 for apartment repairs. ’
Grisco’s apartment had an annual premium, or cost, of $52. “I didn’t hesitate to get this insurance,” she said. It was clearly the right decision. ’
Ukrainian woman Ekaterina Vasilieva also had a war risk insurance policy for her car. Which was to expire in April 2024. This was especially timely. A day later, his car was damaged by a Russian shrapnel while parking on the streets of the coastal city of Odessa. “I had only extended my comprehensive car insurance the day before and the manager offered me insurance against military risk,” she says. ’
War risk insurance is a general term for the sector that provides cover against terrorism as well. Industry experts say the insurance market has grown at a rapid pace since the 9/11 attacks in the United States in 2001. ’
People can also take out war risk insurance. Companies around the world buy to insure their operations, facilities and employees, especially in high-risk countries and regions.
While it’s difficult to collect data for an industry that avoids the spotlight, a trade paper this year estimated that war risk insurance will now cost about $1 billion a year globally. About 80 per cent of this number, or $800 million, goes to specialist insurance companies in the City of London, the centre of the international war risk insurance market.
Joanna Cousins leads a 9-member political violence and war team at Westfield Speciality, a London-based insurance company. Citing the example of a large energy facility in Iraq owned by a Western company, Cousins said, “There have been several attacks in recent years, with the owners of the company eventually purchasing more than $100 million worth of war risk cover.” ’
People in the war risk market are generally reluctant to talk about how much a policy costs. But for British or American companies operating in Lebanon or Israel, the current premium rate is between 0.5 per cent and 2 per cent of the total cover they buy, according to a senior war risk insurance underwriter in London. –Agency
