Insurance Marketplace Realities 2026 – Political risk

Rate predictions: Political risk

	Trend	Range
Typical year-on-year rate movement		0% to +10%

Key takeaways

Geopolitical flashpoints

• High-profile conflicts continue to roil the market
• Simultaneously, rising nationalism and protectionism across multiple regions increase instability — raising underwriting caution regarding expropriation risk

Market dynamics: Hard market with glimmers of flexibility

• The political risk market remains hard, but some insurers are gradually adopting more flexible stances for multicountry programs (as long as they don’t include China or Taiwan)
• Insurers continue to favor long-term buyers, prioritizing their limited China/Taiwan capacity and grandfathering in large multicountry portfolio programs that would not be viewed favorably in today’s market

Capacity and opportunity zones

• Countries of particular client interest that capacity is available in: Mexico, Malaysia, Nigeria, India and Indonesia
• Constrained capacity: China, Taiwan and parts of West Africa (Mali, Burkina Faso and Niger) Sudan, Israel

Broadening buyer base

• Traditionally the purview of global multinationals, political risk insurance is increasingly gaining traction among Middle Market enterprises

Trends and insights

Political polarization and government intervention

• WTW’s Political Risk Index — H1 2025 highlights a global surge in political polarization, including affective, elite and ideological divides: posing greater threats from workforce unrest, policy volatility and political violence
• Such polarization often manifests in regulatory overreach or sudden state action: evident in recent high-profile examples like Guinea’s nationalization of mining concessions in favor of newly formed state entities
• These shifts underscore the growing importance of "gray zone" risks; subtle, ambiguous threats like abrupt regulation, expropriation, or state-backed corporate reassignments