Ukraine is preparing business insurance against shelling with coverage up to $10 million: how the new model could work

Ukraine is discussing a new large-scale system of war risk insurance for businesses, which should bridge the gap between real losses of companies from Russian attacks and the capabilities of current state programs.

Among the parameters currently being considered are a coverage limit of up to $10 million and an estimated insurance cost of about 2%.

However, these are not yet approved terms. The concept continues to be discussed by the Ministry of Economy and Environment, the National Bank, the Export Credit Agency, the insurance market, and business representatives.

Why the current program is no longer sufficient

The state mechanism for war risk compensation in Ukraine is already operating.

For enterprises in high-risk territories, the current program provides compensation for damaged or destroyed property up to 30 million UAH.

For businesses in other territories, the state can compensate part of the insurance premium — currently the maximum amount of such support is 3 million UAH.

But the scale of business losses after Russian attacks far exceeds these limits.

The problem is especially acute for large manufacturing enterprises, warehouse complexes, logistics centers, and retail chains, where the cost of a single facility or inventory can be measured in hundreds of millions or billions of hryvnias.

Agreed claims alone could total 6.74 billion UAH

The scale of demand is shown by data from the Export Credit Agency, which administers the current program.

During its operation, the ECA has received about 605 claims. Of these, 315 have been approved, and more than 200 were under review.

At the same time, the potential maximum volume of compensation for already approved claims alone is up to 6.74 billion UAH.

The state budget for 2026 currently allocates only 1 billion UAH for the program.

This gap clearly shows why the government is looking for a model that will not depend entirely on direct budget payments.

What is proposed to change

The new system should function differently from ordinary state compensation after the destruction of an enterprise.

The idea is to distribute war risk among several participants:

• businesses themselves;
• Ukrainian insurance companies;
• international reinsurers;
• the state;
• international financial partners.

The state should take on the part of the risk that the commercial insurance market is currently unable or unwilling to cover.

This is especially important for large facilities, since the capitalization of Ukrainian insurance companies limits the size of risk they can keep on their own balance sheets.

Coverage up to $10 million is still only under discussion

One of the key parameters of the future system is a possible coverage limit of up to $10 million.

This is an order of magnitude more than the current state compensation of 30 million UAH for damaged property and should make the insurance product more applicable for medium and large businesses.

But there is no final decision on the coverage amount yet.

During discussion with the EBA, company representatives also expressed their own preferences.

Of the 86 participants in the express survey, 51% named coverage of $10 million as acceptable, 28%—$5 million, and 44% indicated $20 million or more. Respondents could choose several acceptable options.

Thus, $10 million is currently seen more as a working point for further system adjustment, rather than as an already approved state limit.

What a tariff of about 2% means

Another discussed parameter is the estimated insurance cost at about 2%.

It is important not to confuse the insurance tariff with a tax or mandatory state levy.

This refers to the estimated price of insurance coverage that an enterprise can pay for war risk protection.

For example, with an insurance base of 100 million UAH, a 2% tariff in the simplest calculation would mean an insurance premium of about 2 million UAH. Real conditions may differ significantly depending on the object, its location, liability limit, deductible, and other contract parameters.

Business itself has not yet reached a consensus on price.

According to the EBA survey, 29% of participants consider a level of about 1% of asset value acceptable, 35%—2%, and 14% are ready to consider a tariff from 3%.

At the same time, almost half—48%—stated that the cost should be determined individually depending on the type and value of the object.

Thus, a fixed tariff of 2% also cannot yet be considered a future rule.

Why it is hard to scale such a market without the state

War risk insurance fundamentally differs from ordinary insurance against fire, accident, or theft.

A massive missile or drone attack can simultaneously damage dozens of objects in one region.

For an insurer, this means the risk of simultaneously receiving a large number of major claims.

Moreover, international reinsurance of such risks remains expensive, because the war continues and it is impossible to accurately predict the frequency and scale of future attacks.

That is why the NBU supports the idea of a public-private model, where the state helps the market accept risks that are too large for individual insurance companies.

Part of the funds is planned to be raised from Europe

The future system is not planned to be built solely at the expense of the Ukrainian budget.

The NBU believes that external resources can be attracted, including funds and insurance capacity of European partners.

At the same time, part of the resource should be formed within Ukraine.

At the first stage, state participation is likely to be significant, since the private market is not yet able to independently absorb the entire volume of risk.

In the future, the authorities expect to gradually reduce the state share and transfer most of the risks to the commercial insurance sector.

94% of surveyed companies say existing protection is insufficient

Business need for a new model is confirmed by a survey by the European Business Association.

94% of surveyed company representatives said that existing instruments are insufficient to cover losses and war risks.

Another 78% believe that a new mechanism for distribution of first losses could improve enterprises' access to insurance.

These figures are particularly telling against the backdrop of a series of attacks on trade, production, and logistics facilities in the summer of 2026.

In individual cases, the value of destroyed warehouses, equipment, and inventory many times exceeds the maximum compensation under the current state program.

In parallel, the current program is planned to be expanded

While the universal system is still being developed, the government plans to change the already operating mechanism under Resolution No. 1541.

In particular, the inclusion of new types of property is being discussed:

• fuel;
• transport for fuel transportation and storage;
• agricultural machinery;
• trucks;
• trailers and semi-trailers.

The mechanism is also intended to be extended to certain movable property in transit through high-risk territories.

In addition, the government is considering including Kyiv and Kyiv region in the list of high-risk territories for the purposes of this program.

Compensation procedure is also intended to be accelerated

Another problem of the current system is the lengthy processing of payments.

According to the ECA, collection and verification of documents can now take four to five months.

About three months of that time may be spent on the work of local commissions and entering damaged property into the relevant register.

For an enterprise whose warehouse or production line has been destroyed, such a timeframe is critical: money is needed immediately for repairs, purchasing equipment, replenishing inventory, and paying salaries.

One of the options to speed up the process should be submission of claims through “Diia” and automatic verification of part of the information.

The new model is not yet a law or a ready program

The most important thing for businesses is not to perceive the discussed figures as already in effect conditions.

Coverage up to $10 million and an estimated price of about 2% are currently only parameters of the concept.

The government still has to agree on the system architecture, sources of funding, distribution of risks between the state and insurers, reinsurance terms, and rules for enterprise participation.

Separately, it will be necessary to reach agreement with international partners on how much risk they are willing to take on.

Until then, enterprises continue to use the current compensation program and commercial insurance products.

What could ultimately change for business

If the new model can be launched, the main change will not be just an increase in the size of the state payment after another strike.

The government is trying to create a market where large war risks are distributed in advance among business, insurers, reinsurers, and the state.

This should give enterprises the ability to insure assets for amounts significantly exceeding current state limits and reduce the dependence of each major loss on an individual budget compensation decision.

But so far, key parameters remain subject to negotiation: the limit of up to $10 million and the tariff of about 2% are being discussed, while the final cost, funding sources, and terms of the new system have not yet been approved.