Global conflicts drive demand for war risk insurance
Summary
The demand for war risk insurance has increased due to ongoing conflicts in Ukraine and the Middle East. This type of insurance covers damages from warfare and terrorism, and it is primarily bought by companies with international operations. Most of the insurance policies are sold by specialist insurers based in London.Key Facts
- War risk insurance covers damages from warfare and terrorism.
- Natalia Grishko benefited from war risk insurance when a missile damaged her apartment in Ukraine.
- Ekaterina Vasylieva's car in Odesa was covered by war risk insurance after being hit by shrapnel.
- The global war risk insurance market is valued at about $1 billion annually.
- Approximately 80% of war risk insurance spending goes to specialist insurers in London.
- Companies with operations in high-risk areas, like a large energy facility in Iraq, buy substantial war risk coverage.
- Premium rates for war risk insurance range from 0.5% to 2% of the coverage value, depending on the region's stability.
- An underwriter assesses the risk and calculates the insurance premium for the coverage.
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