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Going Undercover: The Paradox of Political Risk Insurance

Author

Listed:
  • 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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    1. Kobrin, Stephen J., 1980. "Foreign enterprise and forced divestment in LDCs," International Organization, Cambridge University Press, vol. 34(1), pages 65-88, January.
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    4. Multilateral Investment Guarantee Agency, 2009. "World Investment and Political Risk 2009," World Bank Publications - Books, The World Bank Group, number 2688.
    5. Nathan M Jensen, 2005. "Measuring Risk: Political Risk Insurance Premiums and Domestic Political Institutions," International Finance 0512002, University Library of Munich, Germany.
    6. Theodore H. Moran & Gerald T. West & Keith Martin, 2007. "International Political Risk Management : Needs of the Present, Challenges for the Future," World Bank Publications - Books, The World Bank Group, number 6814.
    Full references (including those not matched with items on IDEAS)

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