Mandatory Liability Insurance for High-Hazard Facilities
In Ukraine, it is legally mandated for enterprises and other legal entities operating high-hazard facilities to carry liability insurance against potential damages arising from emergencies. This is stipulated by Order of the Ministry of Internal Affairs of Ukraine №1081 dated December 28, 2023, "On Approval of the Procedure and Conditions for Insuring the Liability of Economic Entities, Other Legal Entities Using High-Hazard Facilities, for Damages That May Be Caused as a Result of Emergencies," registered with the Ministry of Justice of Ukraine under №147/41492 on January 29, 2024.
PJSC "Company "PRESTIGE" offers businesses the opportunity to enter into insurance contracts to secure protection against potential financial losses. This coverage addresses the need to compensate for damages caused by fires and accidents at high-hazard facilities, particularly those whose economic activities could lead to ecological or sanitary-epidemiological emergencies.
Advantages of insuring with PJSC "Company "PRESTIGE":
Enhanced financial stability for the economic entity.
Expert support in ensuring reliable protection for compensation of damages caused to the life, health, and/or property of third parties, as well as to the environment (including natural resources, territories, and nature reserves), resulting from fires and/or accidents at high-hazard facilities.
What is insured?
The insured are the client's (policyholder's) property interests that comply with the law and are related to the policyholder's compensation of direct damages to third parties due to a fire and/or accident at a high-hazard facility.
Who can be the policyholder?
Economic entities that own, fully manage, or operationally manage high-hazard facilities, or those that use or possess these facilities.
What is recognized as an insured risk?
An insured risk is an emergency situation, including fire and accident at the insured facility, an ecologically hazardous accident, a man-made or natural disaster, an accident posing a threat to public sanitary or epidemic health, and operations to prevent or mitigate the consequences of a fire or other emergency.
What constitutes an insured event?
An insured event is the infliction of damage to injured third parties, for which the Policyholder bears responsibility for compensation, due to the occurrence of an event that is an insured risk. This includes damage to the life and health of injured third parties, property of individuals and legal entities, and harm to the environment.
What is the insurance sum?
The insurance sum for a group of facilities depends on the minimum wage at the time of contract conclusion and cannot be less than the following for an individual high-hazard facility:
- Class 1: No less than 5500 times the monthly minimum wage established by law as of January 1 of the year the liability insurance contract is concluded.
- Class 2: No less than 4500 times the monthly minimum wage established by law as of January 1 of the year the liability insurance contract is concluded.
- Class 3: No less than 3500 times the monthly minimum wage established by law as of January 1 of the year the liability insurance contract is concluded.
| Hazard Class of Facility | Minimum Insurance Amount (in minimum wages) | Minimum Insurance Amount, UAH (as of 01.01.2025) |
| Class 1 hazard | 5 500 | 44 000 000 |
| Class 2 hazard | 4 500 | 36 000 000 |
| Class 3 hazard | 3 500 | 28 000 000 |
How much will the insurance contract cost?
The insurance tariff, expressed as a percentage of the annual insurance sum for facility groups, is as follows:
- Category I hazard: from 0.15%
- Category II hazard: from 0.17%
- Category III hazard: from 0.19%
The final cost will depend on the class and subclass of the hazardous substance, its usage conditions, the type of economic activity, the location of the high-hazard facility, and the duration of the contract.
What are the stipulated insurance payouts under the contract?
The amount of the insurance payout is calculated based on the nature of the damage incurred and is specified directly in the insurance contract, in accordance with Ukrainian legislation.
Is a deductible (franchise) stipulated by the contract?
A deductible is determined as a percentage of the insurance sum by agreement of the parties. However, it does not apply to insurance payouts for damages to the life and health of third parties.
For what period can an insurance contract be concluded?
The insurance contract is concluded for a term of up to 1 year.