A $US350 million ($527 million) insurance program involving the US International Development Finance Corporation and Aon has been established to support investment directed at Ukraine’s urgent economic needs and long-term recovery. 

Aon says it has co-ordinated a $US50 million ($75 million) reinsurance facility, working closely with the finance corporation and Ukraine’s Ministry for Development of Economy and Trade, to support issuance of war risk policies to businesses operating in Ukraine. 

Aon and the finance corporation also collaborated on $US300 million ($451 million) in war risk insurance designed for Ukraine’s healthcare and agriculture industries. 

“Capital will not go where it is not protected and this unprecedented program with the US International Development Finance Corporation is intended to unlock and accelerate investment in Ukraine at a time when the need is most acute,” Aon president Eric Andersen said at a recovery conference in Berlin. 

“This groundbreaking facility will enable the local insurance industry to appropriately price risk and draw much-needed new capital into Ukraine, while creating capacity and capability in the country to support reconstruction.” 

ARX, a Ukrainian subsidiary of Fairfax Financial, will be the first company certified as qualified to access the reinsurance facility provided by the finance corporation. 

Qualified companies can provide war risk policies to businesses operating in Ukraine, and in the long term the facility could encourage participation by other reinsurers, promoting a foundation of private investment essential to a recovery, Aon says. 

The US in September appointed former commerce secretary Penny Pritzker as special representative for Ukraine’s economic recovery. 

“As we looked for opportunities to support the Ukrainian economy, we recognised that a robust insurance market was essential to attracting investment in the country,” Ms Pritzker said. “This facility and the infusion of new private capital into Ukraine will help local businesses operate in the country today, while preparing Ukraine for reconstruction and further economic growth.”