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Political Risk Insurance
Overview:
Property Damage due to Political Violence
- Covers physical loss or damage to tangible assets due to Political Violence.
- Includes both war risk and terrorism in one policy.
- Can be extended to include Business Interruption.
- Abandonment of Operations
- Covers abandonment of operations due to Political Force Majeure.
- Political Force Majeure includes both Political Violence and Foreign Government action.
- Recognizes that war, civil commotion, terrorism, etc., can cause a total loss even where no physical damage occurs.
- Foreign Government actions can include License Cancellation, prohibition of operations, etc.
- Sanctions coverage (actions of the investor’s government) can also be covered.
Confiscation/Expropriation
- Covers the taking over of the Foreign Enterprise or assets by the Foreign Government and other expropriatory action.
- Includes Forced Divestiture, where your own government requires you to exit from the Foreign Enterprise.
Breach of Contract
- The central risk for many infrastructure investments (power, water, roads, telecom's, etc.)
- A separate section of cover is required to cover Breach of Contract by the Foreign Government effectively.
Currency Inconvertibility
- Covers dividends, loan repayments or other capital remittances against currency inconvertibility and transfer risks.
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