Skip to content
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
Insurance Journal - Property Casualty Industry News

Featured Stories

  • State Farm Still Wants a 30% Rate Increase in California
  • 2024 P/C Combined Ratio Best in More Than a Decade
  • Articles
  • Jobs
  • Markets

Current Magazine

current magazine
  • Read Online
  • Subscribe
  • Login
  • Front Page
    • National
    • International
    • Most Popular
    • Magazine
    • Forums
    • Blogs
    • Videos/Podcasts
    • Newsletters
  • News
    • Most Popular
    • National
    • International
    • East
    • Midwest
    • South Central
    • Southeast
    • West
  • Magazines
  • Research
  • Directories
  • Jobs
  • Features
    • Events
    • Forums
    • Market Directories
    • Quotes
    • Polls
    • Rankings & Awards
    • Insurance Giving Back
  • Subscribe

Political Risk Losses Up in 2019, Hitting 68% of Surveyed Firms: WTW

December 6, 2019
Email This Subscribe to Newsletter
  • Article

A survey of 41 major corporations by broker Willis Towers Watson found that 61% believe political risk levels increased in 2019 while 68% have actually suffered a political risk loss.

Disruption of international trade was considered the most significant risk in the majority of regions, the survey found. Trade sanctions were cited by 58% of respondents as a concern for their operations in Europe, while 70% of respondents in Asia Pacific were worried about trade sanctions. For Russia and The Commonwealth of Independent States (CIS), the figure was 77%.

Sanctions against Russia, Iran and Venezuela, a trade war involving China, and the threat of Brexit in Europe were reported as concerns by respondents.

Concerns about political violence were the highest in Africa (74%) and the Middle East (71%), with respondents reporting that new technologies such as drone strikes could exacerbate such risks.

During 2019, there was an increase in the proportion of companies reporting that they had experienced political risk losses. For example, 54% of respondents had experienced a loss due to political violence, compared to 48% in 2018, and 46% reported losses due to trade sanctions or import / export embargoes in 2019, compared to 2018’s figure of 40%. (See graphic below for details of the types of political risk losses experienced by firms during 2019, compared with 2018, according to WTW’s survey results).

Note: number of companies experiencing political risk loss is 28 in 2019, 14 in 2018.

At the same time, the Willis Towers Watson survey said, 32% of companies with revenues exceeding $1 billion reported experience of a catastrophic (more than $250 million) political risk loss.

“It is clear from our survey that political risk continues to increase, and that related financial losses are on the rise,” said Paul Davidson, chairman of Financial Solutions at Willis Towers Watson, in a statement accompanying the survey results. “Corporations now face a strategic choice: to either maintain their global business models while accepting, mitigating or transferring the political risks associated with them, or attempting to realign themselves with the emerging shape of a new and apparently more nationalist global landscape.”

The vast majority of respondents (71%) stated that emphasis on political risk management at their company had increased since 2018, and nearly 40% felt that they were facing more pressure from investors regarding political risk management.

The survey found that recent developments such as the China-U.S. rivalry and the sanctions that have arisen as a result have made political risk more tangible.

As in previous years, the study included follow-up interviews with a panel of survey participants. The panel’s top risks of concern included:

  • U.S.-China strategic competition
  • Middle East regional stability
  • Environmental/Social/Governance (ESG) shock. While this risk did not appear among the top ten in 2018, panelists indicated that rising tensions between business and society were increasingly leading to political risk events.

Source: Willis Towers Watson

Topics Trends Profit Loss Europe China

Was this article valuable?

Thank you! Please tell us what we can do to improve this article.

Thank you! % of people found this article valuable. Please tell us what you liked about it.

Here are more articles you may enjoy.

Hack of Contractor Was at Root of Massive Federal Data Breach
Complaints About Florida Insurers Have More Than Doubled in 5 Years, or Have They?
Despite Backlash From Trump, DEI Hasn’t Disappeared at US Companies
Driverless Trucking Firm Aurora Puts Human Back in Driver’s Seat

Interested in Political Risk?

Get automatic alerts for this topic.

Email This Subscribe to Newsletter
  • Categories: International & Reinsurance News, National NewsTopics: environmental social and governance (ESG) criteria, Paul Davidson, political risk insurance, political risks, Research and Trends, Willis Towers Watson, Willis Towers Watson Financial Solutions
  • Have a hot lead? Email us at newsdesk@insurancejournal.com
More News
Air Traffic Control System Failing Americans, Airline CEOs Say
Thames Water Tops List of Firms Facing Criminal Probes Over Pollution
Climeworks Is Cutting 22% of Staff as US Climate Backlash Hits Carbon Removal
Aircraft Lessor SMBC’s Proceeds From Russian Jet Insurance Settlements Hit $1.4B
More News Features

Read This Next

  • Political Risk Losses Up in 2019, Hitting 68% of Surveyed Firms: WTW
  • North Dakota Insurance Commissioner Granted Authority to Require Restitution
  • Florida OIR Fines Centauri Specialty for Unappointed Adjusters, Other Issues
  • US House Bill Reintroduced to Rid Federal Insurance Office of Subpoena Power
  • Rising Civil Unrest, Political Violence Remains Top 10 Risk for Global Businesses: Allianz

Insurance Jobs

  • Senior Consultant – Risk & Analytics (Property & Casualty Actuarial Consulting) - Atlanta, GA
  • Home Office Underwriting Manager – Commercial Surety - Hartford, CT
  • Sales Agent – Richardson - Richardson, TX
  • Sr Assistant Client Service Specialist - Hartford, CT
  • Catastrophe Field Property Adjuster - Remote, IL
MyNewMarkets
  • 5 Ways to Prepare for Healthcare Liability Changes in 2025
  • What's Next For Workers' Comp?
  • Soft D&O Market May Come to an End as Risk Complexities Rise
  • Exclusions: Active Assailant Coverage - Oh My!
  • 10 Things to Know About Insuring Boats & Marinas
Claims Journal
  • Report Shows Cargo Theft Risk at All-Time Highs as Memorial Day Weekend Nears
  • Department of Labor Keying in on Workplaces with Highest Injury Rates
  • Court Says Google, AI Firm Must Face Mother's Lawsuit Over Suicide of Son
  • State Farm Still Wants a 30% Rate Increase in California
  • No NOAA Large-Disaster Data Could Hurt Insurer Grasp of Secondary Perils, Says AM Best
Academy of Insurance education
  • May 22 Commercial Property: Five Bombs and How to Defuse Them
  • June 5 E&O and Hard Markets: How Trying to Keep a Client Might Cause Trouble
  • June 12 Rating AI Tools: Balancing Functionality and Security
  • June 19 Can You Hear Me? Yes, I Am Listening!

Insurance News

  • News by Region
  • News by Topic
  • Yesterday

Site Search

Features

  • Insurance Markets Directory
  • Forums
  • A.M. Best Company Ratings
  • Industry Events
  • Agencies For Sale
  • Newswire
  • Insurance Jobs
  • Rankings & Awards

Connect with us

  • Email Newsletters
  • Magazine Subscriptions
  • For Your Website
  • RSS Feeds
  • Twitter
  • Facebook
  • LinkedIn
  • Do Not Sell My Info

Insurance Journal

  • Submit News
  • Advertise
  • Subscribe
  • Reprints
  • Link to Us
  • Contact Us

Wells Media Group Network

  • Insurance Journal
  • MyNewMarkets.com
  • Claims Journal
  • Insurance Journal TV
  • Academy of Insurance
  • Carrier Management
© 2025 by Wells Media Group, Inc. Privacy Policy | Terms & Conditions | Site Map