The debut program for property insurance against military risks, launched by Raiffeisen Bank (Kyiv) in collaboration with insurance companies ARX ("ARKS"), "Universal", "INGO", and the world's largest international broker Aon, has attracted 8 projects since its inception in April of this year, with a total insured project amount of 100 million UAH and issued loans amounting to 1 billion UAH.
"This is quite low, to be honest; we expected more… But this is just the beginning; we are essentially building a market that doesn't exist," said Alexander Pisaruk, chairman of the board of Raiffeisen Bank (Kyiv), in an interview with Interfax-Ukraine.
He pointed out that discussions with clients revealed two main factors slowing down the program: for large corporations, the average size of the proposed insurance coverage (20-30 million UAH) is too small, while for small companies, the insurance rate of 1.5-3% is too high, which is a classic issue of military insurance during wartime. Additionally, companies are hesitant to insure property that is very close to the front lines, the banker added.
Pisaruk believes that during a major war, there will be little military risk insurance available due to the lack of reinsurance, and the insurance is very expensive because of the excessively high risks. However, such debut programs are crucial for establishing benchmarks in the market and for quickly launching it once the war is over.
He also mentioned that Raiffeisen Bank is expanding the list of insurance companies it collaborates with on other programs. "This has been made possible by the National Bank's efforts to increase capital requirements, improve the transparency of shareholder structures, and the operations of insurance companies," the chairman noted.
According to information on the bank's website, Raiffeisen Bank is currently an insurance intermediary for the following insurance companies: "UNIKA", "UNIKA Life", "Universal", "ARKS", "ARKS Life", "USG", "PZU Ukraine", and "INGO".