Public-private partnership will enable grain exports from Ukraine at scale and support global food security
New York | November 15, 2023
Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, in collaboration with the Ukrainian government, the Export Credit Agency of Ukraine, Ukreximbank, Ukrgasbank and DZ Bank, today announced the launch of a new facility – Unity – to provide affordable insurance supporting the export of grain and other critical food supplies globally from Ukraine’s Black Sea ports.
Underwritten by insurers based at Lloyd’s of London, Unity will provide up to US$50 million in hull and separate protection & indemnity (P&I) war risk insurance. Ukreximbank, the State Export-Import Bank of Ukraine, and state-owned Ukrainian bank Ukrgasbank will provide standby letters of credit, each confirmed by DZ Bank, to support the facility which itself is backed by the Ukraine Ministry of the Economy, providing ship owners and charterers with war risk insurance in the absence of safe corridors. Global law firm, Norton Rose Fulbright, provided advisory services.
As with the ‘As One’ facility launched to provide insurance under the now defunct Black Sea Grain Initiative in July 2022, Marsh will extend the new Unity facility to clients of Lloyd’s of London registered brokers, to provide added support to ongoing humanitarian efforts and alleviate continued pressure on supply chains and global food security.
John Doyle, President and Chief Executive Officer, Marsh McLennan, commented: “Marsh McLennan is committed to mobilising our unique expertise to support global food security and stability. The launch of this insurance facility will especially benefit the developing nations that buy much of Ukraine’s grain and also help Ukraine’s future recovery and reconstruction endeavours. Through these efforts, we are fulfilling our purpose as a company to give our communities and clients the confidence to thrive.”
Denys Shmyhal, Prime Minister of Ukraine, said: “The launch of the Unity facility will enable Ukraine to provide vital food supplies to the world at the same time as supporting the Ukrainian economy and keeping the Black Sea open for international trade. This partnership between the Ukrainian government, Marsh McLennan and Lloyd’s of London is a sign of confidence in our economy and demonstrates that Ukraine is open for business.”
Today’s launch follows June’s announcement when Marsh McLennan committed to provide services on a pro-bono basis to the Ukrainian government which – as well as Marsh’s insurance expertise – includes building a data platform for the assessment of war risks in Ukraine, strategic advisory services from Oliver Wyman, and catastrophe reinsurance modelling from Guy Carpenter.
Marcus Baker, Global Head of Marine, Cargo & Logistics, Marsh, said: “The creation of this public-private partnership, with insurers working in tandem with the Ukrainian government and its banks, will accelerate the urgent resumption of vital grain exports amid the ongoing effects of this brutal conflict. Unity’s unique structure will enable underwriters to price risks at more affordable levels than those experienced in recent months.”
John Neal, CEO, Lloyd’s, added: “Lloyd’s welcomes the establishment of this insurance facility, which brings together the expertise of our market to provide an innovative solution that will ensure the safe transport of Ukrainian grain and agricultural products out of the Black Sea and help alleviate global food insecurity.”
