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Political Risk & Trade Credit

Specialist insurance protection in respect of emerging markets, political violence, credit and wider political risks to a range of clients.

In an era of uncertain times, political risk insurance offers businesses comprehensive coverage against potential losses stemming from government actions, political unrest, and economic instability.

Who is it for?

A wide range of industries including commodity traders; foreign investors; banks and financial institutions; project financiers and sponsors; forfaiting companies; and exporters and importers of goods and services.

Our covers

What we insure 
Named Perils - Political Risks

  • Stock, plant or equipment held in a foreign country (mobile asset cover)
  • The equity interest held in a foreign enterprise (fixed asset/equity interest cover)
  • A loan made to a borrower in a foreign country (lenders interest cover)
  • A contract with a privately owned company in a foreign country (private buyer/supplier – political perils only cover)
  • A mortgagee’s interest should there be a need to repossess an asset located in a foreign country (non-repossession/mortgagee’s rights cover)

Comprenhensive Cover - Contract frustation and Credit

  • Contracts for sale/purchase/lease of goods or services on open account terms*
  • Prepayments made for goods to be delivered in the future
  • Loans made to finance identifiable trade flows or specific projects 
  • Loans secured against trade receivables and/or tangible assets of the Obligor
  • Loans not linked to, or secured over, specific contracts but made to Public Obligors whose sole responsibility is infrastructure spending or the financing of trade activities

Policy duration

Up to a maximum of 15 years

  • Government Actions - This covers discriminatory actions taken by a host government against foreign owned assets or businesses located in that country, leading to a permanent loss or cessation of activities. Perils include expropriatory acts, licence cancellation or embargo. Also covered are the insured’s government’s actions leading to the forced divesture or abandonment of the insured interest.
  • Political Violence - Property damage due to events such as war or terrorism. 
  • Currency Inconvertibility - An inability to convert local currency held within a host country into hard currency and transfer it out of the country due to a government moratorium.
  • Arbitration Award Default - A dispute with a host government over a key concession or contractual arrangement resulting in an arbitral award that is subsequently not honoured.

Contract Frustration. Limit €50 million per buyer

  • Contract Frustration Insurance – cover against default by a government owned counterparty (a “Public Obligor”) under a contract for the sale or lease of goods or services, or a loan.

Trade Credit €30 million per buyer

  • Credit Insurance – cover against default by a counterparty not owned or controlled by a government (a Private Obligor) under a contract for the sale or lease of goods or services, or a loan.

Where is this offered?

Europe, with option to cover worldwide

*The cover can include provision to indemnify clients for one or more of the below items: 
¹ Pre-shipment cover - the costs directly associated with the contract incurred before an invoice is issued. 
² Post-shipment cover - the amounts not paid following an invoice being issued. 
³ Contract bond cover - if contract bonds are required to be posted by the Insured we can cover the loss due to the calling of these bonds where the Obligor has no right to do so, or they are called because the contract is frustrated due to a political peril.

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