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Political Risk Insurance

Political Risk Insurance

What is political risk insurance definition?

Political risk insurance is a type of insurance that can be taken out by businesses, of any size, against political risk—the risk that revolution or other political conditions will result in a loss.

Political risk insurance is available for several different types of political risk, including:

Political violence, such as revolution, insurrection, civil unrest, terrorism or war;
Governmental expropriation or confiscation of assets;
Governmental frustration or repudiation of contracts;
Wrongful calling of letters of credit or similar on-demand guarantees;
Business Interruption; and
Inconvertibility of foreign currency or the inability to repatriate funds.

What do you mean by political risk?

Political risk insurance is a type of risk faced by investors, corporations, and governments that political decisions, events, or conditions will significantly affect the profitability of a business actor or the expected value of a given economic action.

What is the risk of insurance?

1. A probability or threat of damage, injury, liability, loss, or any other negative occurrence that is caused by external or internal vulnerabilities, and that may be avoided through preemptive action.
2. Finance: The probability that an actual return on an investment will be lower than the expected return.

What is meant by political risk insurance or political risk insurance definition?

Political risk insurance is a type of insurance that can be taken out by businesses, of any size, against political risk—the risk that revolution or otherpolitical conditions will result in a loss.

What is a macro political risk?

DEFINITION of 'Macro Risk' A type of political risk in which political actions in a host country can adversely affect all foreign operations. Macro risk can come about from events that may or may not be in the reigning government's control.