NU Online News Service, Feb. 9, 3:20 p.m. EST

Broker and risk adviser Marsh is advising clients affected by the unrest in Egypt to file an interim payment request—but not exactly to obtain money.

“The amount of the interim is almost immaterial, because what it does is it forces a decision on coverage,” said Alan Morton, senior claims advocate in Marsh's international division, during a webcast talking about risk and insurance issues in Egypt.

“If an insurer doesn’t think the claim is covered, he’s not going to pay an interim,” Mr. Morton said. “I would rather know that earlier. I would rather have that issue up front.”

The move “encourages an early debate,” said Mr. Morton, adding that clients should put all policies—whether for political risk or property damage, for example—on notice.

“I don’t think it’s the clients’ job to tell, at this stage, where the claim is going to fall,” he said. Once the facts have been considered, a determination can be made as to “where the coverage pockets might lie.”

Evan Freely, global head of Marsh's political risk and trade credit practice, said that in the “immediate term” he can’t see pricing for political risk insurance going “anywhere but up” in the Middle East, with availability somewhat lower.

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A survey of carriers indicates many are not writing at all until they understand if any other countries can be affected by the uprising in Egypt. They are “somewhat concerned about places like Yemen,” and to a lesser extent, Jordan, Syria, Libya and Algeria, Mr. Freely said. Others see the area as a potential opportunity, looking at where the assets of the insured are located, he added.

In other parts of the world, Mr. Freely said he does not foresee a “huge impact on pricing,” but coverage will be underwritten a lot more in depth based on location and investors’ relationships with the government.

Beverley Marsden, associate director of Aon Risk Solutions’ crisis management practice, recently said it is too early to tell if the events in Egypt will lead to losses in the market.

For the last several weeks thousands of Egypt’s citizens have taken to the streets, seeking the ouster of President Hosni Mubarak and an end to his 30-year rule. Recently protestors marched on parliament to block the entrance.

Special Reports /

Marsh: Spur Egypt-Related Coverage Debate With Interim Payment Request

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