Political risks insurance (PRI) is an important tool for companies to safeguard their projects and/or investments in overseas markets against political uncertainties.
Companies can also use PRI to unlock access to mid to long-term financing as it gives lenders additional comfort that the impact of political uncertainties over the performance of a project or investment has been mitigated.
What is the assistance?
PRIS enables qualifying Singapore companies to receive premium support for PRI policies. International Enterprise (IE) Singapore will support 50% of the premium for up to the first three years of each PRI policy. This is subject to a maximum amount of S$500,000 per qualifying Singapore-based company.
A typical PRI policy cover risks such as:
Currency inconvertibility and transfer restrictions
Breach of contract by host government
Non-honouring of sovereign financial obligations
Who can apply?
PRIS is a financial assistance programme under IE Singapore’s Global Company Partnership (GCP) programme.
GCP is for all Singapore-based companies with:
Clear internationalisation plan
Competitive product or service
Potential economic benefits to Singapore
To qualify for PRIS, you would also need to fulfil the following criteria:
Singapore-based company with at least 3 strategic business functions^ in Singapore
Global HQ anchored in Singapore#
An annual turnover not exceeding S$500million
An annual total business spending* of at least S$250,000 in Singapore for each of the past three years
A minimum paid-up capital of S$50,000
At least three managerial staff who are Singaporeans and PRs
^ Strategic business functions refer to activities such as (i) banking & financial, (ii) marketing and business planning, (iii) procurement, logistics, (iv) training & personnel management, (v) investment planning/ co-ordination, (vi) R&D and design, (vii) technical support, (viii) manufacturing, and (viiii) other value-added (VA) activities.
# Refers to global (not only regional) management control and decision making functions (e.g. strategic global planning and management, HR, sales and marketing, finance and treasury) based in Singapore.
* Total Business Spending refers to expenses incurred by the company-applicant.
- Staff costs (salary, training etc)
- Finance costs (bank loans/ overdrafts/ interest)
- Other operating expenses e.g. Advertising & promotion, Audit fee, Depreciation, Director’s remuneration, Freight charges, Insurance cost, Office rental, Professional consultant’s fees, Telecommunications, Utilities. For list of exclusion examples, please refer below.
Total Business Spending excludes:
- Costs of goods sold/ Cost of sales/ Distribution and selling expense
- Exchange-rate losses
- Allowance for doubtful debts
- Income tax expense
- Property tax expense
How to apply?
Approach any Singapore-registered PRI broker/insurer to structure and procure a PRI policy.
Should your company qualify for support under PRIS; the PRI broker/insurer will assist you in the submission of your application for PRIS premium support to IE Singapore.
To find out more
Contact IE Singapore’s Customer Service Centre at 1800-IESPORE (1800-437 7673) or +65 6337 6628,
or visit our iAdvisory Centre located at Level 10, Bugis Junction Office Tower (Opening hours – Weekdays: 9am – 6pm).