Sovereign Risk Insurance Ltd., a joint venture between subsidiaries of XL Capital Ltd. and ACE Limited, that writes political risk policies in emerging markets, announced that its sixth year of operation had been quite successful.
“For the fiscal year ending June 30, 2003, Sovereign underwrote 22 new political risk insurance policies,” said the bulletin. “Sovereign’s gross written premium for the year was $60.5 million, with net written premium of $48.6 million. Sovereign paid three claims during the year for events related to the economic crisis in Argentina, which were largely offset by recoveries from a previous claim in Indonesia.”
CEO and President Price Lowenstein commented: “We are pleased to post such strong financial results for a period that presented challenges for emerging market investors, lenders, and insurers alike. In addition to compensating three of our clients for financial losses in Argentina, we were pleased to have assisted a number of clients in loss avoidance and mitigation. Sovereign’s membership in the Berne Union enabled a number of our clients to continue to convert and transfer funds during the crisis. We also supported clients in restructuring and rescheduling their exposures, which we expect will result in full loan repayments or substantial claim recoveries. We believe that our experience this year confirms the value of our product and services. We are encouraged by signs of a pick up in finance and investment flows into emerging markets and look forward to continuing to serve our clients’ needs going forward.”
Sovereign is a leading provider of political risk insurance and reinsurance. Its portfolio “exceeds $5.9 billion of exposure spread over 75 emerging markets,” and its clients include “financial institutions, national export credit agencies, leading multilateral agencies and multinational corporations.”
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