Impacts of the terrible situation in Ukraine
The current situation has impacts which are far reaching for us individually and as businesses.
While we cannot keep abreast of all that is happening in this fast-moving environment, the following are issues that you may wish to consider.
Cyber
There is currently an increased cyber threat and you can read our latest Regulation Update on the message the FCA is giving on cyber.
Losses to businesses that result from cyber warfare or cyber-attacks that may be linked to the actions of a particular country or government are a common exclusion in cyber insurance policies. Your clients may need to check their cover.
Cyber insurance providers are often able to give their policyholders advice and guidance on steps they can take to reduce the risk or effects of a cyber-attack. There is also advice and guidance available from the National Cyber Security Centre
If you have clients seeking cyber insurance, contact the BIBA Cyber Scheme provider CFC.
Sanctions checking
Sanctions against individuals and organisations are being imposed with regularity and it is important for everyone in our sector to be right on top of sanctions checking obligations.
Use the BIBA member Sanctions Checking facility which, monitors any changes to the Consolidated List and rescreens customer data when there has been a change to make your checks.
Travel insurance
The BIBA Medical Travel Scheme provider, All Clear and Holiday and Sports Travel provider, JLU have indicated the following impacts on travel insurance.
The Foreign Commonwealth and Development Office has advised, since October 2021, against travel to the Dombas region and Crimea and has advised against all travel to Ukraine since 24 January 22. Most travel insurance does not provide cover if traveling against FCDO advice and there would be no cover for those travelling to Ukraine after 24 January 2022. We expect that, in addition, a War and Civil Unrest General Exclusion would apply.
Regarding airspace restrictions and no-fly zones it is assumed that any disruption or cancellations as a result of aviation restrictions would be dealt with by airlines or holiday companies. Insurance policies are likely to have an exclusion for cancellation due to ’restrictions implemented by any government or administration…..’ which would negate cover.
If holiday makers choose not to travel to other destinations because of the disruption it is unlikely that cover would apply, it being treated as disinclination. However, their tour operator, travel company or airline may allow them to change the dates or destination andit should be they who are approached first.
Summary of situation for those with trips booked to Ukraine
Government measures
Firstly Government announced additional economic measures, introduced by the Foreign Secretary, including against the Russian Central Bank and the state’s sovereign wealth fund, meaning the majority of Russia’s financial system is now covered by UK sanctions.
The new measures prohibit UK individuals and entities from providing financial services to the Central Bank of the Russian Federation, as well as the Ministry of Finance and National Wealth Fund.
Government also announced that Russian companies in the aviation or space industry will be prevented from making use of UK-based insurance or reinsurance services directly or indirectly
These further economic sanctions will limit the benefits Russian entities receive from their access to the global insurance and reinsurance market.
New Government regulations came force on 8 March around Russian aviation and space insurance prohibiting UK based insurance and reinsurance providers from undertaking financial transactions connected with a Russian entity or for use in Russia. You can read more in our Regulation Update.
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