AM BestTV at RIMS: Investors in Emerging Markets Are Embracing Political Risk Coverage, Say Panel

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)-- In this ^AMBestTV episode at the Risk and Insurance Management Society, Inc.’s (RIMS) conference in Boston, MA, a panel of political risk insurance experts said private equity firms and other investors are increasing their use of political risk insurance to protect their investments across a range of regions. Click on http://www.ambest.com/v.asp?v=politicalriskpanel419 to view the entire program.

Jared Kotler, head of credit & political risk insurance (CPRI) practice, The Hartford, highlighted what type of political risk insurance coverages typically are available.

“There are a number of insured perils that are covered under a political risk insurance policy,” said Kotler. “These perils, such as expropriation, currency convertibility and political violence are typically not covered under a global property program for manufacturers or various types of investors with assets overseas. … If you are a company that has not invested in emerging markets in the past and are thinking about it or are concerned about your assets that are in emerging markets, this is the type of coverage for you.”

The panel also addressed the cyber and terrorist components to political risk insurance.

“On the terrorism side, cyber is proving to be a very effective way to impact, to get headlines and to disrupt,” said John Minor, director of crisis management and political risk, Aon Risk Solutions. “The challenge is how do you know if it is a terrorist or a government? Generally, if it is an attack that requires more resources, it is probably government. North Korea, Russia and China have been known to do cyber attacks. These countries are clear examples of governments using cyber to attack and create disruption. Unfortunately, our market does not yet have a good solution to address these risks.”

Other people that appear in this episode:

Richard Abizaid, regional product leader and head of the Americas, Axa XL; and
Suzanne Garrod, senior vice president and head of the Americas, credit and political risk

Zurich North America.

For full video coverage of RIMS, including exclusive executive interviews, visit http://www.ambest.tv/rims19.

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AM Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit www.ambest.com for more information.