Political Risk Insurance
WE CAN OFFER:
CONFISCATION, EXPROPRIATION, NATIONALIZATION DEPRIVATION INSURANCE
overseas investments including plant, inventory, office facilities, mobile equipment and
other assets (whether physical or financial).
This coverage insures against the taking of an asset or enterprise by a foreign (host)
government without prompt, adequate and effective compensation.
EXPORTATION AND IMPORTATION INSURANCE
Protects against financial loss for either a purchase or sales agreement due to the
intervention of the respective sovereign government. Includes transfer risk, and
revocation of export or import licenses.
WRONGFUL CALLING OF (ON-DEMAND) BANK GUARANTEES INSURANCE
For contractors and exporters required (under the terms of the contract) to post bank
guarantees (backed by standby Letters of Credit) in favor of the foreign government - to
secure bids, guarantee performance, assure the agreed use of advance payments, or to
support a warranty against latent defects.
Unconditional bank guarantees are callable on demand, with or without
justification, by the foreign beneficiary and thus can create uncontrollable loss
potential for the contractor or exporter.
Insures the repatriation - by a foreign subsidiary to parent company - of such things as
dividends or other distribution of profits; distributions from liquidation
of securities, principal and interest payments on loans for advances, royalties and fees.
An inconvertibility situation may be viewed as passive - inordinate delays in
approving conversion - or as active - where the blockage is a direct result of
law or governmental decree.
CONTRACT FRUSTRATION/REPUDIATION DEBT DEFAULT INSURANCE
For sales or service contracts with foreign governments. Designed to protect from the
financial consequences of the failure of a governmental entity to honor its contractual
obligation, including, especially, the obligation to pay amounts due for products sold or
Coverage may be extended to include
· Inconvertibility of local currency and Transfer Risk
· Import/Export Embargo
· License Cancellation
· Contract Termination due to Force Majeure events of a political nature.
PURCHASE CONTRACT COMPLETION INSURANCE (a.k.a. PRE-PAYMENTS OR PRE-EXPORT FINANCE)
Protects importers against non-delivery of goods or commodities when such non-delivery is
due to a political event. (There are markets that will provide commercial cover for this
risk). If the importer has pre-paid for all or part of the goods, the policy would also
cover failure, for political reasons, to return the advance payment if the goods are not