Japanese firms stop insuring ships in all Russian waters: report

Three Japanese insurance companies will stop insuring ships for damage in all Russian waters due to the war in Ukraine, potentially affecting Japan’s energy imports such as liquefied natural gas (LNG), the Nikkei newspaper said on Saturday.

Tokio Marine & Nichido Fire Insurance Co, Sompo Japan Insurance Inc and Mitsui Sumitomo Insurance Co started notifying shipowners of their decision on Friday, Business Daily reported.

Calls to the three companies for comment went unanswered on Saturday.

The insurers’ decision was prompted by reinsurance companies refusing to assume risks related to the war that Moscow started 10 months ago, the newspaper said.

The stop, which applies even to waters in Russia’s far east, far from the fighting, could make shipping there too risky for some companies, it said.

Japan’s LNG imports from Russia’s Sakhalin-2 gas and oil project could be affected, the Nikkei said. Partly owned by Gazprom and Japanese companies, the Sakhalin island complex is vital to Japan’s energy security, accounting for 9% of the country’s LNG imports.

The three Japanese insurers are likely to start negotiations with reinsurance companies about possible resumption of coverage after the Christmas holidays, the Nikkei said.

© Thomson Reuters 2022.

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