<![CDATA[Geopolitical instability elevates investment risks, shifting reliance toward Political Risk Insurance and away from standard Bilateral Investment Treaties. Applying doctrinal legal research with conceptual, statutory, and case approaches, this study investigates the normative conflict between private insurance contracts and public international law. Results demonstrate that hidden subrogation practices during dispute settlements generate severe double recovery problems. Tribunals repeatedly fail to deduct prior insurance payouts from fair market value arbitral awards, ultimately facilitating unjust enrichment alongside coercive diplomacy against developing host nations. To establish equitable international burden distribution, this article proposes incorporating a Mandatory Subrogation Deduction Clause within future treaties and arbitration rules. This pivotal legal reform formally obligates arbitrators to strictly subtract earlier compensation amounts from final financial verdicts. Consequently, this intervention effectively safeguards state sovereignty, neutralizes systemic exploitation, and guarantees structural fairness across transnational dispute resolution architectures amid ongoing macroeconomic fragmentation and pervasive global geopolitical market volatility challenges today.]]>
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