Counsel for businesses with heavy involvement in Eastern Europe are reading the fine print on their policies to help mitigate the impact of the disruption created by the Russia-Ukraine conflict. In an interview with Los Angeles Business Journal, Partner Kirk Pasich explained that while force majeure clauses could be a central point of contention in the coming months, they aren’t airtight, and, in any event, businesses may need to look to their political risk insurance policies to recover economic losses.
“If I had business in Russia, my first questions would be whether I have political risk insurance and what my obligations are,” Pasich said. “To varying degrees, political risk insurance protects businesses in the event of political violence, forced abandonment and expropriation of business.”
He also noted that many political risk insurance policies contain short windows to give notice, and businesses potentially impacted by the invasion should review their policies and act immediately.