Japan suspends insurance of Russian ships

It is reported by the Japanese Nikkei daily.

On December 23, Tokio Marine & Nichido Fire Insurance, Sompo Japan Insurance and Mitsui Sumitomo Insurance began to inform shipowners about their decision. It was made after 10 months of Russia's full-scale war against Ukraine. The reason for this was the refusal of foreign reinsurance companies to assume risks associated with Russia.

This decision means that the coverage of losses from the war will not be provided anywhere in Russian waters, even in the Far East, which is far from the war in Ukraine. So, sailing in these waters will become too risky for most operators.

However, the move to cancel insurance for ships in Russian waters may affect Japanese imports of liquefied gas from the Russian Sakhalin-2 project. Imports of this product to other countries may also suffer losses. 

Shipowners will have to take out additional war damage insurance before sailing in Ukrainian and Russian waters. Insurers must be notified in advance so that they can monitor the terms of payments and premiums. Starting next year, ship owners will not have such an opportunity from three Japanese insurers.

The newspaper reports the decision of Japanese insurance companies reflects the industry's perception of the risks associated with the war. The danger, which was foreseen earlier, has spread beyond the Black and Azov Seas, which are located near the site of hostilities.

In February, after the full-scale invasion began, the London-based Joint Military Committee added the waters around Ukraine to the list of high-risk areas. This committee includes members of the Lloyd's Market Association, which runs the world's largest insurance market.