Ukraine's war risk insurance (WRI) market is moving beyond experimental pilots towards a more structured ecosystem as new state-backed mechanisms, international guarantee facilities and private reinsurance capacity come onsite this year, according to a report from Denton.
The shift reflects the start of de-risking capital deployment into assets and projects in non-frontline areas, supports lender confidence and underpins reconstruction-focused investment.
DFC–Kniazha VIG deal adds retail and SME capacity
One notable milestone, according to the report, came in February, when Kniazha Vienna Insurance Group (Kniazha VIG) finalised a war risk reinsurance facility with the US International Development Finance Corporation (DFC).
According to the announcement, DFC is providing up to US$25 million in reinsurance capacity, supporting a portfolio of up to US$100 million in Ukraine war risk policies for small and medium-sized enterprises (SMEs) and private individuals. The treaty, effective Feb. 1, is designed to back commercially underwritten property policies in non-frontline regions, expanding the range of insurable risks for domestic clients while anchoring new international capacity in the local market.
Kniazha VIG is among the first Ukrainian insurers to secure a dedicated DFC-backed reinsurance limit for war risk, following earlier DFC support for ARX/FortuneGuard facilities. The deal signals growing confidence among international public and private players in Ukraine-based risks where exposure is well defined and backed by analytics and co‑guarantees.
Resolution 1541: state compensation and premium support
On the public side, Ukraine has now put in place its first nationwide framework to subsidise war risk insurance and compensate destroyed business property, the report said.
Under Resolution No. 1541, effective Jan. 1, 2026, the Cabinet of Ministers approved procedures for partial compensation of the value of business property destroyed or damaged as a result of Russia's aggression, and for partial reimbursement of insurance premiums under war risk policies.
Implementation is entrusted to Ukraine's Export Credit Agency (ECA). The regulation caps support at up to UAH10 million per business, including affiliated entities, for direct property damage in specified high-risk regions, and up to UAH1 million per year per entity for premium reimbursement nationwide, excluding occupied territories.
According to the report, while the scheme does not amount to a full national war risk insurance pool, it directly addresses one of the main barriers cited by domestic businesses and banks - affordability of meaningful war risk limits. The framework is significant because it makes properly underwritten war risk products more accessible to mid-sized domestic firms that previously might have gone uninsured or under‑insured.
The market has also benefited from a series of public-private initiatives aimed principally at trade and logistics.
The UNITY facility, launched in November 2023 by the Ukrainian government in partnership with Marsh McLennan and Lloyd’s, initially offered reduced-rate war risk cover for grain and other critical food cargoes moving to and from Ukrainian Black Sea ports. As of March 2024, UNITY was expanded to cover all non-military cargo, including iron ore, steel, electrical equipment and containerised goods, with significantly lower war risk premiums than standard market pricing.
Meanwhile, the URGF guarantee facility, backed by the EBRD and managed by Aon, provides up to €110 million of reinsurance support to enable local insurers to write war risks on inland cargo, motor and railway rolling stock, supported by reinsurers such as MS Amlin. Local carriers including INGO, Colonnade and UNIQA have already used the facility to issue policies, broadening access to cover for logistics and transport operators.
On the property and investment side, private-sector initiatives have started to deliver more bespoke products. FortuneGuard, working with Ukrainian insurer ARX and backed by DFC and international reinsurance capacity, has brought to market commercial property and construction war risk solutions, generally focused on assets situated a defined distance from the front line and with limits per risk of up to tens of millions of dollars.
Towards a national war risk system
A comprehensive, codified war risk insurance system remains under development.
Draft Law No. 12372, registered in the Verkhovna Rada in late 2024, envisions a multi-layer national framework for war risk insurance. It would create a State Agency for War Risk Insurance under the Ministry of Economy to coordinate policy, standardise products, set pricing principles and maintain a central database.
As of early 2026, however, the draft has not been adopted and further revisions are expected. The National Bank of Ukraine (NBU) has publicly signalled its expectation that war risk legislation will be advanced as part of a broader capital markets and reconstruction agenda, and has worked with the Ministry of Economy on the design of a scheme consistent with EU regulatory norms.
In the meantime, ECA’s expanded remit on investment risk, plus the Resolution 1541 compensation mechanisms, are providing a bridge between ad hoc solutions and a future statutory system.
