Lloyd’s of London is in talks with the United Nations about providing insurance cover for Ukrainian grain shipments if a new agreement on the Black Sea corridor can be reached, the company’s CEO, John Neil, told Reuters on Thursday. Turkey, a member of NATO, is seeking to persuade Russia to return to the so-called “Black Sea Grains Initiative” sponsored by the United Nations, after Moscow withdrew in July, ending a year of protected exports from Ukrainian ports amid the war.
“Are we able to continue providing insurance if the corridor can be restarted? The answer to that is: yes,” said Neil. He added: “We are in active discussions with the United Nations about how this could happen,” explaining that those talks included the possibility that the cover would need to be organized differently than before. “In the absence of UN intervention and UN authorization, we will not agree to insurance,” Neal said.
He added that the estimated losses to the Lloyd’s market, after deducting reinsurance, from the Ukrainian conflict amounted to 1.4 billion pounds ($1.74 billion). Insurance company Beazley covered ships in the grain corridor and also in the separate humanitarian canal that Ukraine established in recent weeks to enable ships stuck in Ukraine to leave, its chief executive, Adrian Cox, told Reuters, separately, on Thursday. Cox added: “We are in this market to provide the insurance required for these ships to start moving.”
Neil also said a landmark agreement on planes stranded in Russia is “good news” for insurers. AerCap, the world’s largest aircraft lessor, agreed this week to settle an insurance claim over Russia’s refusal to return 17 aircraft leased to Aeroflot, in a dispute over 400 Western aircraft stranded in the wake of the Russian war on Ukraine. The agreement, an apparent compromise in an economic war between Moscow and the West, appears likely to reduce the bill facing insurance companies, which are locked in lawsuits over who should pay for a loss of up to $10 billion.
Lloyds recorded pre-tax profits in the first half of 3.9 billion pounds ($4.9 billion), compared to a loss of 1.8 billion pounds in the first half of 2022, supported in part by higher premium rates. Meanwhile, Paisley recorded record interim pre-tax profits of $366 million, supported by its American properties and European internet companies.