Skip to main content
Survey Report

Insurance Marketplace Realities 2021 Spring Update – Political risk

Credit, Political Risk and Terrorism

April 21, 2021

Traditional political flashpoints compounded by COVID-19 have led to unprecedented challenges.
Rate predictions
  Trend Range
Political risk: Increase (Purple triangle pointing up) Flat to +20%

Key takeaway

COVID-19 and changing political conditions have resulted in unprecedented challenges for multinational corporations, as traditional perils have been amplified by the global pandemic. Although market conditions are challenging, we advise companies with a global footprint to act with urgency before rates increase further or capacity shrinks.

COVID-19 has amplified political risks.

  • Emerging markets have experienced debt crises, resulting in defaults or a need to reprioritize contract payments.
  • Currency inconvertibility and non-transfer remain popular coverages, particularly in nations dependent on commodities or tourism.

Political violence around the world is rising.

  • As strict restrictions on movement ease globally, the threat of public protests is expected to increase.
  • Myanmar experienced a military coup that displaced a democratically elected government.
  • Unrest in Hong Kong continues as demonstrators protest newly enacted security laws.
  • Russia has experienced pro-democracy demonstrations coalescing around the detention of dissident Alexei Navalny.

U.S.-China tensions remain high.

  • The pandemic appears to be accelerating the trend toward economic nationalism and promotion of state champions in such strategic sectors as technology.
  • U.S. has maintained tariffs on Chinese manufacturing.
  • China has referenced an “unreliable entities list” potentially targeting U.S. companies and has shared details on potential damages to corporations they might place on that list.
  • The U.S. continues to remove Hong Kong’s special status protections.

A new administration in Washington brings new priorities to the political landscape.

  • Renewed focus on human rights could cause tension with certain trading partners.
  • The Biden administration imposed a temporary freeze on some military sales to Saudi Arabia and the UAE.
  • Commitment to the Iran Nuclear Accord could foment backlash from regional powers.
  • Divestment mandates remain uncertain during the administration’s regulatory review period.

We are following several trends in the political risk insurance marketplace.

  • The marketplace continues to harden.
  • Some property carriers are excluding strikes, riots and civil commotion; these perils can be addressed through political risk insurance.
  • Capacity for China, Brazil, Turkey, Argentina and Chile appears to be tightening.
  • Carriers are maintaining highly selective postures and insisting on increased due diligence as they reassess appetite.
  • We advise multinational companies to maintain a proactive approach to their global portfolio.


Willis Towers Watson hopes you found the general information provided in this publication informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, Willis Towers Watson offers insurance products through licensed subsidiaries of Willis North America Inc., including Willis Towers Watson Northeast Inc. (in the United States) and Willis Canada, Inc.

Each applicable policy of insurance must be reviewed to determine the extent, if any, of coverage for COVID-19. Coverage may vary depending on the jurisdiction and circumstances. For global client programs it is critical to consider all local operations and how policies may or may not include COVID-19 coverage. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal and/or other professional advisors. Some of the information in this publication may be compiled by third party sources we consider to be reliable, however we do not guarantee and are not responsible for the accuracy of such information. We assume no duty in contract, tort, or otherwise in connection with this publication and expressly disclaim, to the fullest extent permitted by law, any liability in connection with this publication. Willis Towers Watson offers insurance-related services through its appropriately licensed entities in each jurisdiction in which it operates. COVID-19 is a rapidly evolving situation and changes are occurring frequently. Willis Towers Watson does not undertake to update the information included herein after the date of publication. Accordingly, readers should be aware that certain content may have changed since the date of this publication. Please reach out to the author or your Willis Towers Watson contact for more information.


Senior Vice President, US Political Risk Product Leader
Political and Credit Risk

Contact Us