USAID project calls on banks, insurers to join memorandum on risk insurance cooperation in Ukraine
MOSCOW. Dec 12 (Interfax) - The Financial Sector Reform Activity project of the United States Agency for International Development (USAID) has drafted a memorandum of understanding and cooperation in insurance against political violence risks in Ukraine and invites banks and insurers to join this initiative, Ukrainian media outlets said, citing the project's information on social media.
"We invite Ukrainian banks and insurance companies to join the initiative by signing the memorandum of cooperation. Our memorandum implies joint work on the development of political violence insurance products, as well as ensuring the availability of such products for businesses and their promotion on the domestic market," USAID Financial Sector Reform Activity said in its statement.
The memorandum should be considered as the groundwork for developing further measures to promote cooperation between its participants as part of activities they are allowed to engage in under Ukrainian law, i.e. to develop approaches to determine insurable political violence risks based on international practices and analyze types of insurance that will enjoy the highest demand among Ukrainian businesses, it said.
Furthermore, creating a project for insuring against political violence risks using self-insured retention will rely on the best practices and international experience. Steps will be taken to encourage as many insurers as possible to join the political violence risk insurance system, including by signing coinsurance contracts. Ways will be found to provide access to reinsurance coverage with regard to such risks on the local and international markets, and measures will be taken to popularize political violence risk insurance products and to attract a large number of clients, including by increasing insurance coverage and/or reducing insurance rates.
The memorandum can be signed by all Ukrainian insurance market participants (including non-residents authorized to operate as insurers on Ukrainian territory): insurers, reinsurers, insurance brokers and their associations, as well as banks.
Cooperation will take place through delegating their representatives to hold consultations, work out proposals on fulfilling the tasks set in the memorandum, form working groups, and, if necessary, exchange parties' materials and information.
Insurance market participants and banks can join the memorandum by signing the relevant agreement. The coordinator will have to notify the memorandum's other signatories of a new member's accession as soon as possible.
The memorandum will enter into force from the date it is signed by at least two members and will remain valid as long as its signatories are interested in such cooperation. Any party may terminate its participation in it by submitting a written notification to the coordinator 30 calendar days before the date of quitting the memorandum.