Insurance is a critical tool for managing risk—when it works.Let the insurance buyer beware, however, that it doesn't alwayswork equally well everywhere. Coverage problems regularly surprisemultinational companies that require property insurance in remotelocales around the world. Cynics have compared global propertyinsurance to cell phone service: Depending on where you are, yourexperience may vary. By a lot.

Worse, bad choices in global insurance coverage may remainhidden until a remote location suffers a fire, flood, hurricane,earthquake, cyberattack, or other catastrophe. Only in such acrisis scenario does the company discover how many strings areattached to the insurer's promise to pay. The insured business mayunexpectedly face not only coverage gaps, but also unanticipatedtaxes, regulatory scrutiny, delays in claims payments—and,ultimately, extended business interruptions.

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