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Survey Report

Insurance Marketplace Realities 2024 Spring Update – Political risk

May 8, 2024

The ongoing crisis in the Middle East underscores that geopolitical flashpoints are becoming not only more common but also more pronounced in their intensity.
Credit and Political Risk
Rate predictions: Political risk
Trend Range
Increase, (arrows pointing top right) +10% to +40%

Flat for anniversaries within multi-year policies (same host country sub-limits), flat to +10% for increases in host country sub-limits

Overall, the PRI market remains resilient and open for new business but has hardened with the following emerging dynamics:

  • Self-insured retentions (SIRs) are being used more regularly, particularly on transactions with many host countries.
  • Several carriers are lowering their line-size per transaction to not have too much capacity on any one risk given their unpredictable nature; placements require more syndication.
  • Appetite for large numbers of host countries has declined, several carriers preferring single-country transactions or a smaller set of countries, such as five; pricing on programs of a higher number of countries has increased.
  • Having said the above, the hardening is beginning to taper off and stabilize.

Crisis in the Middle East

  • Exchanges of fire between Israel and Lebanese Hezbollah intensified in Q1. Attacks by Houthi rebels in Yemen on global shipping decreased in frequency, but increased in severity, with the first sinking of a vessel and, in a separate incident, the first deaths of sailors. The U.S. became increasingly public in its criticism of Israeli policy, leading to a UN Security Council resolution demanding a Gaza ceasefire.
  • Following intensive U.S. strikes on militia targets, attacks on U.S. bases in the Mideast region largely ceased in Q1.
  • Flashpoints for escalation include the possibility of war with Lebanese Hezbollah, the spread of attacks on shipping to a wider geographic area, rising political unrest in Israel or neighboring states, and the possibility of a direct military confrontation between Iran and either Israel, the U.S. or both.
  • Political risk insurance markets are closed to new risks in Israel at the moment, other than potentially expropriation coverage only, and taking a cautious approach toward neighboring countries more broadly.

2024 will be the “year of elections” with some key elections around the world that could create new geopolitical uncertainties.

  • Countries where political power is contested, but not through free and fair elections, might be susceptible to more turmoil. These countries include Belarus, Chad, the DRC, Iran, Russia, Rwanda, Uzbekistan and Venezuela.
  • From a geopolitical perspective, elections of particular importance will take place in the U.S., Europe (for the European Parliament), the U.K., Mexico, India, South Africa and Indonesia. Recent research by WTW and Oxford Analytica suggests that geopolitical alignments are shifting rapidly, and these key elections could drive some new shifts in that regard.
  • With elections comes the risk of populist rhetoric. Recently, Nicolás Maduro, the President of Venezuela, has made various statements regarding the territorial dispute with Guyana and reiterated Venezuela’s historical claim to a vast territorial landmass. Several major international oil companies are involved in offshore exploration and production activities in Guyana’s waters, and an escalation in tensions might draw in Western presence in the region.

Sovereign default risks can create economic risks for global business, including currency devaluation, non-payment by sovereign entities and outright currency crises leading to exchange non-transfer and private sector defaults. In some cases, sovereign defaults could lead to political violence.

  • According to the International Monetary Fund (IMF), 36 low-income countries are at high risk of debt distress or are already in distress, and thus struggling under an unsustainable debt burden.
  • Recent coups that emerged in Africa since 2020 have also been underpinned by high risk of sovereign default and unpopular cuts in government spending. Protests broke out in response to cuts in government spending in Chile in 2019, Sri Lanka in 2022, and France in 2018 and 2023 demonstrating this trend around the world.
  • In 2024, some notable countries at risk of unrest include Argentina, Lebanon, Ecuador, Brazil, Sri Lanka, Ghana, Colombia, Jordan, Oman and Kenya. Our latest Political Risk Index analyzes the relationship between austerity measures and public protests in greater detail.
  • In our recent Political Risk Index: Spring/Summer 2023, we examine how today’s cost-of-living crisis fuels political turmoil. In addition, as all our Political Risk Index editions do, we provide analysis on 61 countries with respect to their risk levels for expropriation, currency inconvertibility, political violence, terrorism and sovereign default.

We encourage clients with exposures abroad to proactively consider political risk-transfer options for their country.


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 entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).

Each applicable policy of insurance must be reviewed to determine the extent, if any, of coverage for losses relating to the Ukraine crisis. 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 coverage relating to the Ukraine crisis. 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 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. The Ukraine crisis 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.


Head of Political Risk, North America

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