Investment guarantees




MIGA offers insurance to cover five types of non-commercial risks: currency inconvertibility and transfer restriction; government expropriation; war, terrorism, and civil disturbance; breaches of contract; and the non-honoring of financial obligations. MIGA will cover investments such as equity, loans, shareholder loans, and shareholder loan guarantees. The agency may also insure investments such as management contracts, asset securitization, bonds, leasing activities, franchise agreements, and license agreements. The agency generally offers insurance coverage lasting up to 15 years with a possible five-year extension depending on a given project's nature and circumstances. When an event occurs that is protected by the insurance, MIGA can exercise the investor's rights against the host country through subrogation to recover expenses associated with covering the claim. However, the agency's convention does not require member governments to treat foreign investments in any special way. As a multilateral institution, MIGA is also in a position to attempt to sort out potential disputes before they ever turn into insurance claims.

The agency's Small Investment Program aims to promote FDI into specifically small and medium enterprises. The program offers standard MIGA coverage types except it does not cover breaches of contract. Under the program, small and medium enterprises may take advantage of discounted insurance premiums and no application fees, which are not available to larger investors. To qualify an investment for the Small Investment Program, MIGA defines small and medium enterprise projects as having 300 or fewer employees, total assets not to exceed $15 million and annual revenues not to exceed $15 million. MIGA limits the request amount for the investment guarantee to $10 million, and will guarantee only up to 10 years with a possible 5-year extension.

MIGA's annual reports offer an overview of the agency's business.

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