Credit and Political Risk Markets

The private sector credit and political risk insurance markets have matured into a major source of credit support for the world's exporters, traders and international banks. Having started in the mid-1970's with two underwriters - Lloyds and AIG - today the market comprises twenty-five insurance companies and thirty-six Lloyds syndicates. Total per risk limits for political risks are approaching US$3,5 billion. For trade risks the single per risk limit is now in excess of US$2 billion. Credit terms insured have grown from a maximum of three years to seven years with certain underwriters are offering policies for up to ten years or longer.

Trade transactions, contracts, projects and direct foreign investment are all eligible for coverage.

Coverage is widely used by exporters, importers, contractors, commercial banks and investors.

Different markets and underwriters have different skills, areas of interest and risk appetites. As such, specialist insurance brokers play an important role in placing insurance for their clients.

Additional information on the ECIPRI markets is available at: January 2016 AJG CPRI Report & Market Update.