The small print of a regular insurance policy of course excludes damage resulting from war and insurrections, but given the rise in global risks it's no surprise insurers scent a lucrative chance to fill the gap.
Companies can buy a range of policies to protect their factories, hotels or mines from expropriation and political violence, typically in developing countries.
But European risks are not off the radar, particularly after the Cyprus bank "bail in" earlier this year which forced depositors to share rescue costs.
Kim Brownlees, a political risk specialist at insurance brokerage Arthur J Gallagher & Co in London, said he's seen a rise in enquiries from clients for insurance against arbitrary increases in tax on bank accounts in the last few weeks.
"They are looking for protection against confiscation of the assets in bank accounts, or against a punitive tax, which is another form of confiscation," Brownlees said.
Some longer-term trends are also underpinning growth in this opaque branch of the insurance industry.
For corporate CEOs and CFOs, showing they have taken action to protect their assets is integral to meeting higher standards of corporate governance, in force since the financial crisis, and avoiding shareholder wrath.
"These decisions are taken at a very high level in the company," said Nuria Gorog, head of credit and political risk at Zurich Insurance Group AG (>> Zurich Insurance Group Ltd), a major player in political risk with a capacity of $150 million (£100.6 million) per transaction and cover of up to 15 years.
Corporate compliance departments have gotten stronger, while risk and financial officers want the full array of options to mitigate political risk before taking an investment decision.
"This is clear and it's one reason why volumes are increasing more now than in the past," Gorog said.
The EU is doing its bit too.
After the Cyprus bailout in March, EU finance ministers agreed late last month on plans to salvage troubled banks that would require depositors with more than 100,000 euros ($128,600)to share in the cost of saving a lender.
"Cyprus has raised a lot of question marks," Brownlees said, adding it was doubtful cover could be arranged. "You'd have to be a pretty brave man to write that risk."
Hard and fast data on the size of the market is hard to come by, but there are signs more insurers are looking to take on political risks.
"There is more capacity arriving in the market on a regular basis," said Isabelle Girardet, head of the Transactional Cover Unit at Euler Hermes (>> EULER HERMES) (>> Allianz SE), adding that the market had grown by about 10 or 20 percent over the last five years.
After dipping during the financial crisis, the volume of newly insured values in the broader category of investment insurance - of which political risk covers a part - rose by 20 percent last year to $94 billion, according to the Berne Union group of trade and investment insurers.
Total exposure in investment insurance rose more than 9 percent to $219 billion in 2012, Berne Union data show.
Companies weighing up hard-to-quantify future risks will be aware that once a threat becomes immediate, it can be nearly impossible to find cover. "You can't insure a house that's already on fire," as an industry saying goes.
Insurers have little appetite for taking on risks in Egypt, for instance.
Elsewhere the supply of insurance cover available for political risks has been growing steadily, also helped by trends such as booming international investment in commodity extraction and increased transactions between emerging economies. Banks are increasingly demanding it as a condition to finance projects.
Data from Gallagher show available capacity for project risks at around $1.7 billion per risk in July, up 3.2 percent from the start of the year, after rising by 22 percent in 2012 and nearly 7 percent in 2011. Trade-related political risk capacity grew by the same amount so far this year, and by double digits in the last two years.
Some of the capacity boost comes from new entrants like Brit Group <CVC.UL> (>> Apollo Global Management LLC) and Lloyd's of London <LOL.UL> syndicates, but established political risk insurers are also taking on greater exposure, encouraged by the promise of lucrative returns.
Political risk insurance is expensive, typically measured in percentage terms rather than "per mill", or a tenth of a percent, as are standard property and casualty policies.
"Downward pressure on returns at insurance companies as a consequence of low interest rates is prompting them to plough their money into specialties where there are better returns and political risk has been one of the beneficiaries of that," said broker Andrew van den Born at Willis Group Holdings Plc (>> Willis Group Holdings PLC).
Prices have been broadly stable, with increasing demand being matched by increasing supply, brokers said.
Claims are seen as low-frequency but high-severity, so the cost-benefit calculus can still be favourable to companies.
"Political risk claims tend to be total, as opposed to partial, and claims in the millions or hundreds of millions of dollars are not unusual," said Roger Schwartz at Aon Risk Solutions (>> Aon PLC).
Collectively, political risk insurers have settled roughly $3 billion in claims since the start of the financial crisis, compared with annual premiums of about $1.3 to $1.5 billion, Willis estimates.
Companies or banks seeking cover for a power plant or mine can line up very large capacities - up to $2 billion per transaction if adding insurers like Zurich or AIG (>> American International Group Inc) and Lloyds syndicates together - with each insurer taking a slice of the total.
Companies are also reviewing the vulnerability of their global supply chains, while brokers and insurers are offering services to help clients monitor political risks.
Brokerage Marsh & McLennan Cos Inc (>> Marsh & McLennan Companies, Inc.) has partnered with analytical firm Maplecroft to track 45 indexes of economic, social and political variables, using satellite imagery to map risks to company assets down to 100 meters in scale.
Talking about individual clients or specific payouts is always taboo in the insurance industry, even more so with political risk given the fear that governments may be more tempted to cancel a license or expropriate a mine if they know the foreign owner is insured.
Yet corporate interest continues to be spurred by unpredictable high-profile cases, such as Argentina's expropriation of Spanish oil major Repsol's (>> Repsol SA) 51 percent stake in YPF, or the unrest in the Arab world.
"One takeaway from the Arab Spring is that there doesn't have to be any overt action by the host government; political risks can stem from 'soft' risks, such as income disparities or food shortages," Willis's van den Born said.
"It also happened in places most people perceived as investor-friendly."
(Editing by David Holmes)
By Jonathan Gould
Stocks treated in this article : EULER HERMES
, American International Group Inc
, Arthur J. Gallagher & Co.
, Marsh & McLennan Companies, Inc.
, Willis Group Holdings PLC
, Repsol SA
, Allianz SE
, Zurich Insurance Group Ltd
, Apollo Global Management LLC
, Aon PLC