Black and Azov seas are listed waters for insurance underwriters
The Joint War Committee included both the Azov Sea and the Black Sea into its listed waters category on Feb. 15. As a result of the listing, ships sailing into these waters need to notify their insurance underwriters beforehand. LMA Lloyds noted on its website that while no incidents involving shipping have occurred, “the possibility of a miscalculation is clear”, and the notification mechanism was implemented.
Insurance issues also affected air travel over Feb. 12-14 after KLM announced that it was suspending flights to Ukraine. One Sky Up flight from Portugal on Feb. 13 was forced to land in Moldova instead after the aircraft’s owner demanded that the aircraft not enter Ukrainian airspace.
Some carriers were “having difficulties with fluctuations in insurance markets”, the Infrastructure Ministry posted on its website on Feb. 13, and that a solution was being worked out. To cover the airlines, the Cabinet of Ministers announced a USD 592 mln allocation to keep flights in the air.
James Hydzik: The government’s ability to quickly respond to the aviation problem is not likely to be followed by equally strong action regarding shipping. The issue does not resonate with the government’s populist concern with ratings. Also, the rise in the cost of maritime insurance will most likely be passed on through the market. Ukrainian ships have worked around the closures to shipping of large areas of the waters involved, though the most direct routes were closed off due to Russian naval maneuvers. Prices for shipped goods were bound to rise anyway.