This chapter is concerned with understanding the history and operation of the market for political risk insurance, and the related political risk analysis industry that provides metrics, narratives and pricing prosthetics that are used by insurance brokers and underwriters when they negotiate terms and prices for the cover they provide. These prosthetics include a variety of colour-coded ‘heat’ maps, indices and geographical categorizations (such as ‘Sub-Saharan Africa’, ‘MENA’ [Middle East and North Africa] or ‘Asia-Pacific’), which do not determine the pricing of political risk insurance cover but, rather, act as ‘technologies of the imagination’ (Gilbert 2020a) and spur imaginative effects and particular approaches to valuation. As political risk insurance (PRI) brokers and underwriters would themselves argue, PRI does not lend itself to an actuarial mode that seeks to predict the likelihood of future ‘political risk events’ based on statistical tabulation of past occurrences.

This chapter examines political risk insurance as an alternative to international investment treaties, looking at some of the world’s leading providers of this service. It continues with a consideration of investment incentives, followed by a discussion of some of the main sources for further information on international investment law. This chapter then offers a concluding overview of some of the central debates in international investment law.