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Leading broker releases 2012 political risk map

Leading broker releases 2012 political risk map

the past 12 months have seen terrible natural catastrophes from all over the world, and have seen the insurance profession pay out more than $350billion to those in need.    It is obvious that some parts of the world carry more risks than others, but these aren't limited to natural disasters - the world also needs to protect itself from political risk.

Aon, the world's leading insurance broker, each year releases a political risk map, which helps insurers price risks effectively and realistically.  For example, insurers can see what countries may see unrest this year based on upcoming elections (China, Russia, France and the US are all facing elections in 2012).   This sort of information is vital for insurers so that they can offer the correct amount of cover.

On the map, each country is given a rating according to the different risks it faces, which include exchange transfer, sovereign non-payment, political interference, supply chain disruption, legal and regulatory, and political violence.

The key on the map highlights the countries that are at high risk by using the colour red.  The risk decreases with orange, yellow, and then grey.  Venezuela, for example, is faced with many of the risks listed above and is therefore coloured red.  Turkey, on the other hand, is coloured grey to represent a low risk.  Over the years, these colours have changed and will continue to do so as the world is faced with varying political situations.

To watch a vidcast of an Aon employee click here.

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