Howden survey finds most multinationals hit by a political risk loss since 2020

More than half of multinational companies have suffered political risk losses to an international project or investment in the past five years, according to new research by Howden.

The broker’s survey of around 500 senior risk and treasury executives found some 51% of companies experienced losses between 2020 and 2025, most frequently from currency conversion and fund repatriation issues.

A further 6% reported losses above $100m, with a small subset seeing damages more than 10 times their original investment.

The report noted that these were “low-frequency, high-severity events – the very type of risk that political risk insurance protects against”.

Foreign government interference was the costliest factor, with average losses of $20m. Currency exchange difficulties followed at $16.2m, while political violence averaged $14.6m.

Companies carrying political risk insurance (PRI) reported losses $1.4m lower on average than those without cover.

Howden said: “Whilst risk is rising, so too is opportunity. Multinationals are looking for protection as they commit significant capital to international investments and projects.

The role of risk management and insurance is becoming increasingly critical in this fluid environment.”

That shift is reflected in planned adoption of PRI, with 80% of multinationals expecting to use political risk management tools in 2025–30 compared with 68% in 2020–25. PRI showed the largest increase, up 18%. 

Lack of awareness remains a barrier, the broker emphasised.

The survey concluded: “Despite the clear relevance of PRI in the current risk landscape, a lack of understanding of the product is the top reason for not buying cover, cited by 73% of multinationals. This underlines both growth potential and a call to action for the market.”