Lancashire Insurance says that its exposure to the Russia-Ukraine conflict is ‘manageable’.
Speaking on a conference call hosted by Berenberg in London at the weekend, the firm said that its exposure to Russia-Ukraine was manageable and that its worst-case scenario remains an earnings event, not a balance sheet one.
According to Lancashire, it has assessed its exposures, including exposures arising from aviation war policies. In a worst-case scenario, the management said that these would not result in a capital event, although there would be a huge loss.
Despite this, Lancashire said its current strategy and plans for growth this year will remain unchanged.
However, the management said that the situation and uncertainty relating to the industry’s exposures to Russia/Ukraine, as well as supply- chain-driven inflation, will continue to put pressure on rates in forthcoming renewals, management said.
Speaking on the conference call were CEO Alex Maloney, CUO Paul Gregory and head of IR Jelena Bjelanovic.
The ongoing situation in Russia-Ukraine and the fallout on aviation has been a big story on Reinsurance News in recent weeks. Earlier this month, the Russian state said that it planned to essentially nationalise the 500+ planes stranded within its borders, raising a host of issues.
While some estimates put the potential cost at $1.5bn, even Bank of America have come forward to say that the issue could lead to a surfeit of claims for the insurance industry.