Credit & Political Risks
We have many years of experience as brokers, underwriters and buyers of insurance giving us an exceptional perspective and servicing capability.
Our excellent relationships with highly rated, specialist underwriters across the market enables us to deliver well structured, cost effective, bespoke risk transfer solutions. These provide the extra level of security needed when trading and making investments in challenging territories as well as facilitating the efficient management of regulatory and risk capital for financial institutions.
What is credit and political risk insurance?
Credit and Political Risk insurance is a risk management strategy designed to protect investors, lenders and financial institutions against the failure of customers to pay their debts, or against an adverse political environment in a country leading to credit or asset losses caused by confiscation, currency non-transferability and other political risk perils.
Increased exposure to credit and political risk has become a significant reality for companies and financial institutions trading and investing overseas; as a result specialist insurance products are available to mitigate these exposures which can enable the confident pursuit of high return opportunities in frontier markets such as Africa, the Middle East, Asia and Latin America. Multi-year, non-cancellable policies can be arranged to protect against loss arising from all manner of trading and finance transactions as well as loss to fixed investments and mobile assets. Counterparty default and vulnerability to macro political events can be managed with a range of credit and political risk insurance products.
These products protect against:
- Contractual Default including Non-Payment for goods or services supplied and Non-Delivery of goods or services paid for in advance
- Confiscation, Expropriation and Nationalisation including Selective Discrimination and Creeping Expropriation
- Contract Repudiation and Frustration including Concession Agreement / Operating Licence Termination
- Forced Abandonment or Divestiture
- Deprivation (restrictions preventing the (re)export of product or equipment from the foreign country)
- Political Violence including War, Strikes, Riots, Civil Commotion and Terrorism (for more information click here)
- Currency Inconvertibility or Exchange Transfer moratorium preventing the conversion and transfer of monies in respect of accounts receivable, debt service and dividend remittances
- Trade Disruption and Business Interruption
- Non-honouring of Arbitration Award
- Export/Import Embargoes (including those imposed by multi-lateral organisations such as the United Nations or European Union) or cancellation of export/import licenses by the government of a foreign country
- Non-honouring of Letters of Credit and Guarantees
- Calling of on-demand bid or contract bonds and guarantees for unfair or political force-majeure reasons
Who Are Our Clients?
We have provided transactional and associated advisory services to the world’s leading industrial and financial institutions. Credit and Political Risk insurance has become an indispensable risk management tool for companies with international activities and across a multitude of sectors. We serve clients from a wide range of sectors including:
- Banks lending and investing in both developed and emerging markets
- Commodity and natural resources trading companies
- Mining and natural resources developers
- Multinational corporates with overseas operations
- Oil and gas exploration and production companies
- Energy industry contractors and service providers
- Mining contractors
- Construction and engineering companies
- Debt and private equity investment funds