Ukraine to compensate shipowners for up to 80% of losses from Russian attacks

Ukraine’s Cabinet of Ministers has approved a compensation mechanism for shipowners, operators, and charterers for damage to vessels caused by Russian attacks. Under Resolution No. 1248 of October 7, 2026, the state may reimburse up to 80% of assessed losses not covered by war risk insurance. The new mechanism aims to reduce financial risks associated with maritime transportation and support the operation of Ukrainian ports amid wartime threats.

Compensation will be available to owners, operators, and charterers of Ukrainian- and foreign-flagged vessels carrying non-military cargo. The mechanism covers damage sustained in Ukraine’s territorial waters, along the routes of the Temporary Maritime Corridor in the Black Sea, and within the waters of operational Ukrainian seaports where vessel traffic is permitted. However, vessels linked to Russia, Belarus, or sanctioned entities will generally be excluded, subject to exceptions specified in the resolution.

A valid insurance contract or P&I policy at the time of the incident is a mandatory condition for receiving state support. Compensation may cover the loss of a vessel or significant damage to it, repair costs, emergency rescue operations, and lost or damaged cargo. The mechanism also provides for possible reimbursement of wreck removal costs, environmental pollution cleanup, third-party liabilities, and losses related to the death or injury of crew members and passengers.

For losses requiring independent assessment, the maximum compensation will amount to 80% of the assessed value. However, actual payments will depend on the availability of funding in the state budget. The introduction of this mechanism is particularly important for Ukrainian agricultural exports, which rely heavily on maritime logistics. Additional state guarantees could reduce risks for shipowners and charterers and support shipments of grains, oilseeds, and processed agricultural products through Ukrainian ports.

To receive compensation, applicants must submit a claim to Ukraine’s Ministry for Development of Communities and Territories within 180 calendar days of the incident, providing an insurance policy, documentation of the damage, and evidence of the losses incurred. Payments will be made in Ukrainian hryvnia to accounts held with Ukrainian banks. The mechanism will apply to damage occurring from the date the resolution enters into force. Compensation for losses incurred in 2026 will be financed from the 2027 state budget, subject to the availability of the relevant budget allocations.

Tags: Ukraine, war