Political Risk Insurance

WE CAN OFFER:

CONFISCATION, EXPROPRIATION, NATIONALIZATION DEPRIVATION INSURANCE

For 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.


INCONVERTIBILITY INSURANCE

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 services rendered.

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 delivered.

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