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The UK government has announced plans to ban Russian firms from the UK’s aviation/space insurance market in response to the invasion on Ukraine.
The decision will block Russian firms’ direct and indirect access to Lloyd’s and the London market, a key player globally in these speciality areas.
“These further economic sanctions will limit the benefits Russian entities receive from their access to the global insurance and reinsurance market,” the government said in a statement.
The government said it will bring a legislation to block UK-based insurance and reinsurance providers from dealing with Russian entities.
“Further details of the legislation will be available in due course,” it added.
As per Reuters’ report, the ban could sharply increase aviation insurance premiums and force Russian commercial airlines to get insurance cover from somewhere else, which could be Chinese insurers.
Notably, Aeroflot, a Russian airline, is insured by a group led by underwriter Global Aerospace in the London market, two sources told the news agency.
“We are in regular communications with the UK government and international regulators, and are working closely with the Lloyd’s market to uphold the implementation, at pace, of sanctions applied by governments around the world,” Lloyd’s chief of markets Patrick Tiernan was quoted by the news agency as saying.
Other than aviation, marine and energy insurance are leading sectors at Lloyd’s.
Earlier, the European Union announced a ban on re/insurance covering goods and technology in the aviation and space industry.