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 AIG Australia > For Businesses > Assets > Political Risk
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What is it?
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Political Risk Insurance from AIG Australia can be tailored to cover an extensive
range of overseas business: new or existing equity investments, cross-border loans,
or contracts for goods or services. Coverage is designed to protect insureds against
losses that can result from various political perils, including:
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- confiscation, expropriation and nationalization
- currency inconvertibility and non-transfer
- political violence, and
- contract frustration
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Why do you need it?
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The vast majority of businesses in todays global market can benefit from opportunities outside of their home territory.
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Yet few businesses are comfortable with the potential losses that can result from the political risks associated with operating internationally. A foreign governments actionor inactioncan result in loss of property, income or financial assets.
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AIG Global Trade & Political Risk Insurance Company (AIG Global) provides Political Risk Insurance to help financial institutions and corporate clients mitigate political risks worldwide.
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AIG Global assists global companies in managing their international exposures. Our clientsmanufacturers, project developers, contractors and service firms includedlook to AIG Global for political risk solutions.
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Whether a company is entering an overseas market for the first time or is an experienced multinational with extensive international activity, AIG Global can design a political risk insurance program that makes sense.
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Who needs it?
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Case Studies
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CASE SCENARIO #1
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A European electronics components manufacturer with 85% of its income generated
from overseas operations, approached AIG Global for help in managing its huge overseas
exposure. AIG Global responded by issuing a single Political Risk Insurance policy
covering potential losses to the companys assets and income in over 30 countries.
The 5-year policy is non-cancelable and the premium rate is fixed, giving the company
long-term security at a predetermined cost. The policy is also flexibleallowing
for periodic adjustments to limits over the policy period to reflect fluctuations
in exposure.
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CASE SCENARIO #2
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A small but experienced mining company with highly productive acreage in an African
country sought to develop a mine. The investment required to develop the mine was
steep relative to the companys modest capital base. With AIG Global Political Risk
Insurance, the company was able to achieve a complete financing solution. We issued
one Political Risk Insurance policy to cover the investors equity interest; a second
policy covered bank financing for the project.
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CASE SCENARIO #3
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A prominent supplier of telecom equipment was competing for a large contract with
a leading Latin American provider of integrated wireless communications services.
The supplier was confident that it could meet the technical specifications of the
bid, but was unable to offer competitive financing without country risk mitigation.
With an AIG Global Political Risk Insurance policy in place, the supplier was able
to secure the bank support needed for the transaction, provide the required financing
terms and complete the sale.
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Why use AIG Australia ?
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With Political Risk Insurance from AIG Global Trade & Political Risk Insurance Company (AIG Global), companies and financial institutions exposed to cross-border risk gain protection from an insurance organization recognized for its exceptionally strong balance sheet.
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Find out more
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Visit http://aigglobal.aig.com/ or contact us
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