At the EU-Ukraine Investment Conference, the U.S. International Development Finance Corporation (DFC), in partnership with international insurance broker AON and the Ukrainian insurance company ARX, signed an agreement to launch a mechanism for reinsurance against military risks.
This agreement follows DFC's announcement at the Ukraine Recovery Conference (URC) in June to create a mechanism enabling DFC to provide insurance not only for attracting investment but also for supporting small and medium-sized businesses by expanding reinsurance programs for Ukrainian insurance companies.
"We are grateful for the partnership with the United States and DFC in creating a mechanism that will allow the scaling of military risk reinsurance in Ukraine. DFC has shown real leadership in developing and implementing this mechanism. Importantly, this insurance will be provided through Ukrainian insurance companies, which possess relevant expertise in underwriting," noted Ukraine’s First Deputy Minister of Economy, Oleksii Sobolev.
“By working with the private sector, DFC builds investor trust where it is most needed and mobilizes capital essential for strengthening Ukraine’s economy today and in the future. DFC insurance offers vital support to the Ukrainian people and economy as we work towards a brighter and more prosperous future for the country,” said Agnes Dasewicz, DFC’s head of investment.
Under this agreement, DFC will act as a reinsurer for ARX, which will issue insurance policies in Ukraine covering war-related physical damage risks. The implementation of this DFC mechanism is expected to positively impact the number of private companies involved in recovery projects. DFC is also considering additional reinsurance provisions for other Ukrainian insurance companies. The Ministry of Economy, along with the European Commission, is working to establish similar mechanisms with other financial institutions.
