Political Risk Insurance
Political Risk Insurance
Protect Your International Investments, Assets and Contracts
J. Maxime Roy, Inc. helps businesses and lenders manage political risks that can arise in international markets, including government actions, political violence, currency inconvertibility and other non-commercial risks.
Discuss Your SituationWhat Is Political Risk Insurance?
Political risk insurance helps protect against loss resulting from non-commercial risks in a foreign country when government actions or political events interfere with your business, investment, assets or contract.
It can help provide financial protection when events outside your control — such as expropriation, currency restrictions, political violence or certain government actions — prevent you from operating, receiving payment or realizing the value of your assets.
How It Differs From Trade Credit Insurance
Trade credit insurance primarily covers buyer nonpayment of accounts receivable due to commercial risks, including insolvency or protracted default, as well as certain covered political risks.
Political risk insurance primarily protects international investments, assets and contracts against risks such as government actions, currency inconvertibility, political violence, contract frustration and other covered political events.
Principal Political Risks Covered
Coverage and definitions vary by insurer and policy. Common risks include:
Expropriation / Nationalization
Government seizure or nationalization of your assets, or actions with similar effect, resulting in a covered loss.
Currency Inconvertibility and Transfer Restrictions
Inability to convert local currency into U.S. dollars or transfer funds out of the country.
Political Violence
Loss or damage to property and business interruption resulting from war, civil war, terrorism, riot, strike, insurrection or civil commotion.
Government Action / Contract Frustration
Import or export restrictions, license cancellations, contract termination by a government entity or other government actions that interfere with your business or contract.
Real-World Situations
Political risk insurance can be valuable in a variety of international business situations, including:
Foreign Investment or Acquisition
A foreign government expropriates or nationalizes your investment or takes actions that substantially deprive you of its value.
Trapped Profits or Dividends
Your subsidiary is unable to convert local currency into U.S. dollars or transfer funds due to new government restrictions.
Disruption to Operations
Your overseas facility is damaged or your operations are disrupted due to war, terrorism, riot or civil unrest.
Export or Project Contract
A government cancels a license, imposes import or export restrictions or terminates a contract, preventing you from supplying goods or completing a project.
Access to Political Risk Insurance Markets
JMR can explore coverage with leading political risk insurers and specialty markets. The appropriate insurer and policy structure depend on the country, type of investment or transaction, amount at risk, required policy term and the specific political risks that need to be insured.
AIG
Offers a range of political risk insurance solutions, including expropriation, currency inconvertibility, political violence and contract frustration.
Chubb / Sovereign
Provides political risk insurance covering government action, political violence, currency restrictions and other non-commercial risks.
Allianz Trade
Offers political risk and structured credit solutions for investments, export contracts and other international transactions.
FCIA
Provides political risk insurance to cover risks such as expropriation, currency inconvertibility, political violence and other government actions that interfere with your business.
The U.S. International Development Finance Corporation (DFC)
is a U.S. Government agency that provides political risk insurance for eligible overseas investments, including expropriation, currency inconvertibility, government interference and political violence.
Selected Lloyd's Syndicates
Access to Lloyd's syndicates that write political risk insurance on a transaction-specific basis.
Have an International Investment, Asset or Contract You Need to Protect?
Talk with JMR about how political risk insurance can help protect your assets, contracts and cash flows in international markets.