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U.S. SBA/Ex-IM Bank of the U.S. Joint Application for Working Capital Guarantee Application For Medium Term Export Credit Insurance Quotation Application
Export Credit Insurance
Protecting yourself against foreign buyer default can help your company develop and expand its overseas sales. For this purpose, The International Division of the ECIDA brokers both private-sector insurance as well as insurance through the Export-Import Bank of the United States.
Export credit insurance safeguards against foreign buyer default due to political and commercial risks.
Political Risk
Political losses can be caused by war, revolution, cancellation of an existing policyholder's export or buyer's import license, or currency inconvertibility, among other reasons. Currency devaluation, however, is considered to be a commercial risk. The policy lists the specific risks covered.
Among the risks excluded from coverage are disputes with the buyer.
Commercial Risk
Commercial losses are those that affect business anywhere, such as a buyer's insolvency or failure to pay an obligation within 90 days after the due date, including a failure to pay because of a currency devaluation. Among the risks excluded from coverage are disputes with the buyer.
The reasons why exporters and banks buy export credit insurance are threefold:
Competitiveness
Often buyers demand credit or credit terms of sale are necessary to successfully compete, THUS;
Risk Protection
Exporters and financial institutions desire protection against the political and commercial risks of default; AND
Financing
With insurance on a foreign receivable, the proceeds of which can be assigned, it is easier for the exporter to sell or borrow against such receivable thus enhancing cash flow.
To accommodate exporter’s varying needs, two types of short-term export policies are available through Ex-Im:
- Single buyer policy - insuring sales to one buyer.
- Multi-buyer policy - insuring sales to many different buyers.
Medium Term Export Credit Insurance is also available. Click here for application information.
Our insurance customers also qualify for reduced rates on Coface Credit Reports which allow you to analyze your trade partner’s operations, stability and profitability.
For more information on Export Credit Insurance or for assistance in completing a Single Buyer Application or a Multi-buyer Application, please contact us at 856-6525 or e-mail us at earnold@ecidany.com.