Territorial disputes, regime changes and possible shifts in global alliances are political and geopolitical risk themes that insurers need to pay attention to in 2026 and beyond, said Yoel Sano, global head of political and security risk at BMI, a multinational research company and a subsidiary of Fitch.
Speaking at Fitch’s Insurance Insights 2026 event in London last week, Sarno highlighted that the forefront of instability was the Arctic Circle earlier this year amid rising tensions between the United States and several European countries over Greenland’s sovereignty and strategic status.
At the 2026 World Economic Forum in Davos, President Trump claimed that a “framework agreement” had been reached to meet his demands, potentially averting a major rift with NATO.
“That may be enough to meet Trump’s current demands for Greenland,” Sarno said. “On the other hand, Trump may not be happy with the arrangements and raise the issue of Greenland’s future again at some point. So I think we have to wait and see if this issue is resolved.”
Regarding the Arctic Circle, Sarno stressed that the region is becoming a region where the United States, Russia and China (through its “Polar Silk Road”) “intensify and persist in competition” over issues such as air corridors, critical minerals and shipping routes.
Earlier this year, Venezuela also dramatically overthrew Nicolás Maduro on January 3. The country is currently led by acting president Delcy Rodriguez, who faces an internal power struggle between “hardliners” and “moderates.”
“The key thing to watch now is whether Venezuela’s new president, Delcy Rodriguez, maintains a cooperative stance with the Trump administration in getting Venezuela’s oil industry restarted,” Sano said.
“It is unclear whether Venezuela will hold new elections to achieve a true democratic transition.”
Next year, several important elections will be held in Latin American countries, notably Brazil, Colombia and Peru. Recent trends in countries such as Argentina, Bolivia and Chile show that the region is increasingly electing centre-right, far-right or US-aligned leaders.
As a result, the United States appears poised to expand its influence in Latin America in the coming year and beyond, the executive said.
A key election to watch this year is the U.S. midterm elections. Sarno explained that with the midterm elections still more than eight months away, Trump’s current low approval ratings pose considerable upside and downside risks to him and the Republican Party.
Elsewhere, in Iran, the regime currently faces its most significant domestic challenge since 2009. While the government appears to have restored order, it has come at the cost of thousands of lives.
Other risks include the succession of the 86-year-old supreme leader and a possible US/Israeli attack on nuclear facilities.
“Under Trump, the United States has backed away from its initial threat of military action, but I will not end this crisis in any way,” Sano said.
“The risk remains that if Trump attacks Iran in the coming months, it could reignite the protests and lead to divisions within the regime. The succession of Iran’s supreme leader is also very problematic, and there are multiple scenarios for this issue.”
In the Middle East, despite multiple ceasefire agreements, the region remains volatile due to the evolving conflicts between Israel and Hamas and Israel and Hezbollah.
There is ongoing instability in Libya, the issue of the Islamist regime in Syria, and the conflict in Yemen where Saudi Arabia and the United Arab Emirates are backing rival factions.
Sano also talked about the geopolitical risks in the Indo-Pacific region, and the outlook for the region in 2026 is quite complex. U.S.-China relations are in the midst of a period of “brinkmanship” over trade deals and tariffs, with Taiwan remaining a key flashpoint, especially in the wake of a major U.S. $11 billion weapons program and subsequent Chinese military exercises in December 2025.
Back in Europe, the Ukraine-Russia conflict continues, and while a potential ceasefire is being discussed in Davos, such a ceasefire could be fragile and prone to violations.
Sarno said: “The risk of Russia testing European security mechanisms through drone flights, crazy aircraft airspace violations, gray operations, etc. remains. Therefore, even if the conflict in Ukraine ends, this will keep geopolitical tensions at a low level for a considerable period of time.”
The executive added: “There is still potential for both worsening and de-escalation of the conflict in Ukraine. But even if the war in Ukraine ends or is officially over, the geopolitical situation in Europe is likely to resemble some kind of long-term standoff between NATO and Russia for the foreseeable future.”
Another thing analysts are concerned about is nuclear safety. The New START treaty between the United States and Russia is set to expire on February 5, 2026. Sano warned that without an extension, formal limits on the world’s two largest nuclear arsenals would disappear.
“Meanwhile, China is building its nuclear arsenal, as is North Korea. The nuclear standoff with North Korea continues with no obvious end in sight.”
At the same time, space competition is likely to intensify in the coming years as space becomes increasingly militarized.
It is worth noting that NASA is preparing for a manned lunar mission (Artemis II) in early February 2026, while Russia, China and India are expanding their military space capabilities.
Finally, Sano emphasized that with geopolitical competition comes large-scale technological competition.
This great technological competition over the deployment of artificial intelligence and the control of critical materials is unfolding between the United States and China, forcing third-party countries to choose which “technological system” to align with.
