This kind of political risk insurance is purchased by exporters, lenders, investors, and contractors with inventories, equipment, or other assets located in foreign countries. It protects against confiscation, expropriation, nationalization, and other foreign government actions which would deprive you of your rights of ownership or control of your assets. Related political risks that are covered […]
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Contract repudiation
When you’re selling to a foreign government or public-sector buyer, contract frustration insurance or contract repudiation insurance protects against non-payment or arbitrary non-honoring of your contract, either before or after your shipment of goods or performance of services. Political risk insurance is also available to protect against non- honoring of sovereign government payment guarantees, whether […]
Political violence
This kind of political risk insurance protects against non-payment, loss of income, business interruption, loss of equity investments, or damage/destruction of physical assets due to political violence. Covered political risks include war, revolution, civil unrest, rioting, public strikes, armed uprising, insurrection, terrorism, sabotage, acts of malice, or other political violence.
Currency inconvertibility
There are two types of political risk insurance relating to currency risks. One deals with the inconvertibility of local currency into hard currency and the other addresses the inability to transfer hard currency out of the country. Currency inconvertibility and transfer risk policies apply to losses resulting from financial crises, hard currency shortages, exchange controls, […]
Wrongful calling of guarantees
This kind of political risk insurance is purchased by exporters who put up guarantees, performance bonds, bid bonds, or stand-by letters of credit in support of contracts with foreign government or public-sector buyers. It insures against the buyer’s unilateral extension of terms or unfair calling of these kinds of “on demand” guarantees.
