"Preliminary assessments indicate damage to both the factory buildings and stored raw materials. Nearly a month later, the company is still evaluating the full financial impact. Fortunately, there were no injuries resulting from the strike. The Kharkiv factory had halted operations in 2022, and only security personnel were present at the time of the attack."
"While the company's assets were insured, Kalnoochenko mentioned that insurers do not cover war-related risks in Kharkiv and the surrounding areas. As a result, war risk insurance is extremely limited across Ukraine, forcing many businesses to absorb their losses."
"The company stated that it will only consider rebuilding the damaged warehouses once the security situation stabilises. The facility is located roughly 40 kilometres from Russian positions, posing ongoing operational risks. Despite being hit three times since the beginning of the full-scale Russian invasion of Ukraine, the company does not plan to close or sell the site."
Philip Morris International reported at least $16 million in damages following a Russian strike on its Kharkiv facility on January 30, destroying approximately 5,000 square meters of factory space including buildings and raw materials. The facility had been inactive since 2022 with only security personnel present during the attack, resulting in no injuries. Standard insurance policies exclude war-related risks in Kharkiv, leaving the company to absorb losses. Ukraine's partial compensation mechanism offers only up to Hr 10 million ($232,000), far below actual damages. The company will not rebuild until security stabilizes but remains committed to the site, having invested $30 million in a new Lviv facility and $1 million in logistics expansion since 2022.
#war-damage-and-insurance #philip-morris-international #ukraine-conflict-impact #industrial-losses-and-compensation #business-continuity-in-conflict-zones
Read at London Business News | Londonlovesbusiness.com
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