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Going Undercover: The Paradox of Political Risk Insurance

Author

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  • Spagnoletti Belinda

    (Centre for International Risk, University of South Australia)

  • O'Callaghan Terry

    (Centre for International Risk, University of South Australia)

Abstract

Political risk insurance is an insurance product sold to firms as a means to protect them against some political risks associated with investing abroad. This paper argues that political risk insurance may in fact be a source of political risk. Looking at cases in the Asia-Pacific region, we argue that investing firms should exercise caution when considering political risk insurance. We conclude with several recommendations for reform of the political risk insurance industry.

Suggested Citation

  • Spagnoletti Belinda & O'Callaghan Terry, 2011. "Going Undercover: The Paradox of Political Risk Insurance," Asia-Pacific Journal of Risk and Insurance, De Gruyter, vol. 5(2), pages 1-23, July.
    • Handle: RePEc:bpj:apjrin:v:5:y:2011:i:2:n:4
    DOI: 10.2202/2153-3792.1064
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    References listed on IDEAS

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    3. Nathan M Jensen, 2005. "Measuring Risk: Political Risk Insurance Premiums and Domestic Political Institutions," International Finance 0512002, University Library of Munich, Germany.
    4. Theodore H. Moran, 2004. "International Political Risk Management : The Brave New World," World Bank Publications - Books, The World Bank Group, number 15039, April.
    5. Multilateral Investment Guarantee Agency, 2009. "World Investment and Political Risk 2009," World Bank Publications - Books, The World Bank Group, number 2688, April.
    6. Judy Larkin, 2003. "Strategic Reputation Risk Management," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-51141-5, October.
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