According to the Decree of the Cabinet of Ministers of Ukraine No. 388 dated April 19, 2024, the Export Credit Agency (ECA) is entitled to carry out insurance and reinsurance of military and political risks arising in the process of business activities provided by law.

Special attention should be drawn to investment insurance, an important tool for defense of investors against unforeseen events.

Insurance amount

Insurance amount shall be based on risk assessment and the investment project cost. In accordance with conditions specified in the Decree, maximum insurance amount may be restricted by certain ECA limits, in order to facilitate balance between the agency’s risks and opportunities. In addition, insurance amount can be increased depending on project specifications and additional guarantees provided by the investor.

Insurance conditions

Insurance conditions include the following:

1. Risk assessment: Before entry into insurance contract, a detailed assessment of risks associated with the investment project shall be carried out, including analysis of political and economic situation in the country where investment is made, as well as possible military threats. Risk assessment shall be based on the data received from state authorities, independent experts and international organizations.

2. Insurance premiums: The amount of insurance premiums shall be fixed on the basis of risk assessment and investment value. Premiums can be either paid once or spread over a certain period. NB: premiums may vary depending on risk degree and insurance contract validity contract.

3. Payment of insurance indemnity: In case of an insured event, insurance indemnity shall be payable in accordance with terms of the contract. It may include reimbursement of losses related to nationalization, seizure, hostilities or other political risks. The aforesaid process also includes procedure for submitting and reviewing insurance claims, to be detailed in the contract.

4. Reinsurance: To reduce risks, ECA may enter into reinsurance contracts with other insurance companies, in order to distribute risks and to secure stability of insurance payments. Reinsurance also facilitates reducing financial burden on the ECA and securing reliability of obligations to insurants.

5. Additional conditions and specifications: Insurance contracts may include additional terms, such as requirements for insurant regarding precautionary measures, risk monitoring and regular reporting. Special conditions may also be prescribed for certain types of investments, such as infrastructure projects or innovative enterprises.

Therefore, investment insurance provided by the Export Credit Agency is an important tool for protecting investors from military and political risks.

This is a new institute for Ukraine, which promotes attraction of investments and economy development in Ukraine, having facilitated reliable protection of capital investments.

It should be noted that at each stage of insurance conditions the investor will need legal assistance from local lawyers – experts in insurance and investment issues.

For legal advice upon the raised issue, we encourage all the parties concerned to contact Dmytro Ochkolias, Interlegal associate attorney.

More information at the link: