Howden reports 33% surge in demand for political risk insurance

Trade credit insurance has also recorded annual profits over the past decade.

Demand for political risk insurance increased by 33% as businesses navigate heightened geopolitical and macroeconomic volatility, Howden’s 2025 Credit and Political Risk Insurance (CPRI) report revealed.

The report, titled “Opportunity in Flux”, noted that this surge in demand comes at a time when the broader insurance cycle is softening, creating an opportunity for new market entrants and expansion into emerging asset classes and geographies.

According to Howden, CPRI has consistently delivered robust underwriting performance even through recent global shocks such as the COVID-19 pandemic, regional conflicts, and economic disruptions. 

Trade credit insurance, a key segment of the CPRI market, has recorded annual profits over the past decade with an average net combined ratio of 78%.

The report places 2025 as a critical juncture for trade and security, with geopolitical shifts, supply chain restructuring, and financial market uncertainty driving demand for insurance solutions. 

It also identifies armed conflict as the leading global risk this year, nearly twice as significant as extreme weather events, based on analysis by the World Economic Forum and Howden.

The CPRI and surety market now has a premium base of $49b across six product segments, outpacing the growth of many other specialty insurance lines. 

Notably, non-payment insurance (NPI) is expanding quickly in advanced economies.

Howden sees this environment as offering significant opportunities for Indian companies, banks, and public sector institutions. 

With global trade entering a phase of realignment, CPRI can support Indian businesses in mitigating risks and accessing high-return ventures. 

The insurance also helps lower the cost of capital by protecting investments.

Despite the rising demand, the market remains constrained by a supply/demand imbalance, particularly in less developed areas. 

This is attributed to the complexity of products and a conservative stance by many (re)insurers. 

Howden suggests that these gaps represent a growth opportunity for innovation and new players, including those from India.