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Covered risks

Investment guarantees cover losses resulting from the following political risks:

  • Expropriation risk - nationalization, expropriation or sovereign acts which in their effects are equivalent to expropriation
  • Breach of contract risk - the breach of legally binding commitments made by the government or other entities directed or controlled by the government, in as much as the project company is entitled to these commitments and these commitments are specified in the guarantee policy (for detail please refer to our leaflet on Breach of Contract)
  • War risk - war or other armed conflicts, revolutions or civil disturbance or terrorist acts associated with such events
  • Moratorium risk - payment embargoes or moratoriums
  • Convertibility and transfer risk - impossibility of converting or transferring amounts deposited with a sound bank for their transfer to the Federal Republic of Germany

The question whether one of these risks has occurred is evaluated in the event of loss by verifying the actual circumstances on the basis of the German principles of law and in consideration of international law.

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