With the list of flashpoints around the world, from Ukraine, Israel and Gaza to the Red Sea, growing with alarming speed and the prospect of political upheaval in over 60 countries, the world has rarely felt so volatile. This uncertainty can breed inaction. Specialty insurance can help break this inertia, providing businesses with the financial security required to manage the downside risk, embark on investments, and pursue innovations that will be critical to the world’s future economy.

Historically, specialist risk cover has been an afterthought. Acquired at points of clear, precise risk and acute exposure. However, this is changing. Political Risk insurance now brings insights that can mitigate risk alongside the risk transfer that allows businesses to pursue investments amidst the maelstrom of global or local political upheavals. It is recognised by sovereign wealth funds, private equity and other lenders as a vital element of a finance deal for projects in less stable regions of the world.

Africa's rich endowment of natural resources is making it an increasingly attractive destination for investments in the metals and mining sector. However, the continent's history of political instability, changes in regulatory frameworks, and nationalisation efforts pose significant risks and concerns to foreign investors.

It is this instability that underlines the importance of specialist insurance. Amid growing political tensions across the globe, standalone cover for political violence, strikes, riots and civil commotion is increasingly becoming a necessity. As businesses become exposed to a growing range of perils, the need to move away from pure terrorism cover is apparent, with businesses in major Western democracies being particularly affected.

With 70% of the global business leaders we surveyed concerned that the outcome of this year’s numerous elections will impact their international operations and ability to trade, specialist insurance is a vital tool to help allay some of their fears.

By providing coverage for losses, political, trade credit and political violence risk cover enables companies to secure assets against expropriation and political violence. It also reassures lenders and investors, facilitating access to the necessary capital for large-scale mining projects that are at the heart of the renewable energy transition.