As the tragic events unfold in the Ukraine, I am sure everyone's thoughts and sympathies are with the people suffering there. The full geopolitical fallout has yet to be realised, and we can only hope that there is no further escalation by the Putin regime.
Many clients have business interests in either Russia or Ukraine, and as the situation develops we are starting to receive advice and updates from the credit insurers. However, our advice to our clients since the start of the conflict has been simple and remains unchanged:
(1) If you're under contract to export direct to the Ukraine, don't - at least not without checking with your insurance adviser and/or the UK Government. War is a cause of loss under a credit insurance policy that carries political risk cover, and as such the loss has already occurred. Unless the UK Government is prepared to support the transaction (for instance humanitarian aid) then there will be no support from insurers.
(2) If you're under contract to export to Russia, don't - at least not without checking with your insurance adviser. Aside from any moral hazard, the risk of payment default from Russia is very high, and as Western sanctions are increased, many transactions may actually be illegal. Most insurers (at time of writing) have either withdrawn cover or are in the process of doing so. Even if they haven't, don't assume support.
(3) If you're selling to a customer elsewhere, but you are delivering to the Ukraine or Russia, again, don't - without checking as per the above. This is a third country political risk, and unless its explicilty recognised would not be covered. Check the incoterm (defines delivery) and speak to your adviser, and, probably, to your customer as well.
For those with work in progress cover (WIP, sometimes called Pre Credit Risk) on their policies, it may be possible to ensure that at least your costs so far are insured. Much depends on the circumstances. As always, the key is communication, so if you have any questions, contact us.