Political Risk - Contract Frustration
Specialty
XL Catlin’s political risk insurance offering includes contract frustration coverage for clients involved in international business. In a complex and ever-changing global marketplace, suppliers, buyers and financiers face multiple trading risks including non-payment, non-delivery, cancellation of licenses, embargos, war and (un)fair calling of advance payment or performance guarantees. We can help protect companies from suffering losses resulting from any combination of these risks on individual or groups of transactions; whether short, medium or long-term. Coverage is primarily for contracts with sovereign or non-sovereign public sector entities but also may be available for private sector transactions under certain circumstances.

Product details

Capacity

– Up to USD 200 million per risk
– Up to 20 years

Coverage

Doing business internationally can be tough when things go wrong. XL Catlin’s political risk insurance protects businesses worldwide against losses in a range of situations from government embargoes and license cancellations to non-payment and delivery issues. We cover individual contracts and groups of transactions, whether short, medium or long-term. And we can tailor policy wordings to a specific transaction.

Our appetite
– Contracts with governments, public sector bodies and some private sector transactions
– Non-payment
– License cancellation
– Import and export embargoes
– Unfair/fair calling of advance payment or performance guarantees
– Non-cancellable cover
– Non-repayment of an advance payment following non-delivery of goods
– Non-honoring of parental guarantee
– Non-honoring of a letter of credit
– Non-honoring of an arbitration award following unfair calling of a bond
– US political risk insurance policies written on an admitted or non-admitted basis

Client Profiles

Large corporations, both public and private, involved in foreign direct investment, cross-border lending or international business, primarily in emerging markets across a variety of industries
– Exporters/manufacturers 
– Global financial institutions
– Commodity traders
– Engineering/procurement/construction contractors

Typical Information Required

– Summary of the financing transaction to be covered, including the purpose of the financing, tenor, amortization, security structure/collateral and pricing
– Most recent three years financial statements for the obligor/guarantor
– Summary of the insured’s experience doing business with the obligor and in the obligor’s country 
– Coverages being requested and tenor requirements

Benefits & Services

– Capability to issue policies from the US, UK, Singapore, Bermuda, Canada, Brazil, Australia and Insurance segment's Lloyd’s syndicate 2003 to accommodate licensing and geographical location requirements.
– Underwriting locations in New York, London, Singapore, Hamilton, Toronto, Brazil and Sydney provide local, same-time zone access to our global capabilities.

 

This general product description is informational only. It is neither an offer to sell nor a solicitation to purchase any particular insurance product. Products are subject to legal and underwriting requirements. Coverages may not be available in all jurisdictions, including without limitation any jurisdiction within the United States, and may be available only through appropriately licensed producers. In addition, GAPS’s provision of publications or services is not an indication of the existence or availability under any policy of coverage for any particular property or type of loss or damage. Policies underwritten from Bermuda, Brazil, Canada, China, Mexico, Switzerland, or written by XL Insurance Company SE are only available through non US-based brokers. The Insurance companies of XL Group Ltd are: Catlin Insurance Company, Inc., Catlin Indemnity Company, Catlin Specialty Insurance Company, Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Specialty Insurance Company, XL Bermuda Ltd, XL Insurance Company SE, XL Insurance Switzerland Ltd, XL Insurance (China) Company Limited, XL Seguros Brasil S.A. and XL Insurance Mexico SA de CV. Coverages placed with Lloyd’s Syndicate #2003 are managed by Catlin Underwriting Agencies Limited and supported by XL Catlin corporate capital. Additional important information regarding our business is provided on our Legal Notices page.

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