Gallagher's Structured Credit and Political Risks team has extensive experience in delivering specialist non-payment and political risks solutions to businesses, organisations and public sector clients that are trading, investing and operating all over the globe.
Our services go beyond purely the provision of insurance — we tap into the collective experience and knowledge of the insurance market to help you make strategic decisions about future trade and investment opportunities.
Backed by our in-house Crisis Consulting team, we can also help you identify how wider security risks, such as Sabotage, Strikes, Riots and Civil Commotion, or even War/Civil War may need to be considered as part of your risk management strategy.
Credit and Political Risk insurance can help businesses and organisations protect and grow their margins, secure cash flow and access new markets and customers — safe in the knowledge that they are protected. An added benefit is that companies that insure payment risks can typically obtain improved financing terms from banks, providing further liquidity support.
Why consider Structured Credit and Political Risk insurance?
In a highly competitive global environment, many companies are forced to trade on increasingly fine margins or take greater risks in the search for commercial opportunity or yield.
Trading and investment risks can come in many forms; the insolvency of a major customer with outstanding debts, for example, can have a huge impact on a supplier's balance sheet if no coverage is in place. For companies selling to customers in emerging markets, political risks such as cancellation of an import or export license, supply route interruption (due to civil war or riots, for example) or currency inconvertibility can also result in non-payment, which can have a significant impact on cash flow for the uninsured supplier. More catastrophic investment risks, stemming from host government action or inaction, such as expropriation or contractual agreement repudiation, can devalue assets and derail investment returns.
We can provide comprehensive credit insurance to protect you against non-payment from a commercial customer as a result of bankruptcy, protracted default or political risks. If you have assets overseas we can provide you with political risk insurance to help protect you in the event of political interference from the host government, allowing you to own and operate valuable manufacturing or distributing hubs to serve your global customer base.
We have extensive experience in providing solutions for precisely these kinds of risks to businesses worldwide and operating in multiple sectors, from energy and power to mining, telecoms to transport, and manufacturing to healthcare.
Tailored policies to provide comprehensive coverage
Our team uses its experience and breadth of knowledge to create bespoke political risk policies for clients. Coverage can be structured around your trading activity and investments to include:
- Expropriation — confiscation, expropriation, nationalisation, requisition and sequestration of the foreign enterprise by the government of the host country; also, selective and discriminatory acts against the foreign enterprise.
- Breach of Contract — breach (or unilateral renegotiation) of concessions, licence agreements, entered into by the host government which governs the operations of the foreign enterprise.
- Currency Inconvertibility/Non Transfer — inability to convert local currency (e.g. for dividends, licence fees and royalties) or transfer currency out of the host country.
- Political Violence including war on land, strikes, riots, civil commotion, terrorism, coup d'état and rebellion.
- Forced Divestiture due to pressure from the investor or company's own (home) government
- Forced Abandonment — abandonment of the asset typically due to political violence risks.
