Political Risk Insurance

Political Risk Insurance

Aon political risk experts use a combination of market experience, innovative analysis tools and tailored risk transfer programmes to help you minimise and manage your exposure to risks.

Emerging markets continue to be attractive for businesses seeking alternative areas for growth. However, in less mature economies assets, contracts and loans can be adversely affected by government actions. Supply chains are becoming increasingly more vulnerable. Aon has identified an almost 50% increase in supply chain disruption due to government embargoes, interference and strikes, riots, and civil commotion.

Unforeseen political events can lead to:

  • Confiscation, expropriation or nationalisation of assets

  • Imposition of export/import embargoes or cancellation of export/import licenses

  • Physical damage to assets from political violence

  • Termination of or default on contracts

  • Non-payment or moratorium due to exchange transfer and currency inconvertibility

  • Non delivery/shipment of goods

  • Calling of on-demand bid or contract bonds and guarantees for unfair or political reasons

  • Forced abandonment or divestiture of an overseas operation or its assets

  • Non-payment by government and/or government owned entities of trade related debt to financial institutions.

A broad range of possible government actions that often lead to increased costs, penalties, forced shutdowns, loss of profit or liquidated damages.

Flexible coverage

Aon’s political risks experts design risk transfer and management programmes to respond to adverse political actions, providing a combination of balance sheet protection and business facilitation. Insurance can be purchased on a standalone basis, or within a tailor-made portfolio to give you greater flexibility of coverage.

Political Risks RateTracker

Aon’s proprietary live rating guide, RateTracker, provides accurate, historic (13 years) and current transaction costs, including rating and capacity data for more than 160+ countries and 700+ obligors. RateTracker not only provides valuable benchmarking information, but assists with projecting future risk transfer costs. RateTracker’s supporting analytics are compelling and analyse S&P ratings against market rates and much more

Political Risks PortfolioManager

Aon’s unique PortfolioManager enables you to easily monitor your exposure to political risks. This online tool facilitates complicated data analysis in simple visual formats and downloadable reports.

PortfolioManager enables you to monitor on an aggregated and individual basis:

  • Country of risk

  • Ultimate insured

  • Specific categories or types of insurance

  • Policy count

  • Tenor

  • Premium spend

  • Aggregate exposures, both gross and net

Political Risks Assessments

Aon political risk experts can also conduct political and security risk assessments of all the countries and regions in your portfolio, allowing you to make informed decisions regarding your operations and investments. Feasibility studies help underwriters understand your exposures – providing transparent submissions, resulting in comprehensive political insurance coverage with greater contract certainty.

Aon’s Political Risks Map

The Political Risk Map is Aon's benchmark review of the political risks global corporations face. It provides an invaluable guide to political risk insurance markets' perceptions of key risks around the world. Specific risks featured in the map include government interference, legal and regulatory risks, sovereign non-payment and supply chain disruption.

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