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Two types of exposure policies are offered by ECGC to large exporters: 1) Exposure (Single Buyer) Policy, which covers risks on a specified buyer through a separate policy for each buyer. 2) Exposure (Multi Buyer) Policy, which covers risks on all buyers through an aggregate loss limit, finding it inconvenient to get a separate policy for each buyer. The Multi Buyer policy does not cover exports to buyers in restricted countries or those under the buyers specific approval list.
Two types of exposure policies are offered by ECGC to large exporters: 1) Exposure (Single Buyer) Policy, which covers risks on a specified buyer through a separate policy for each buyer. 2) Exposure (Multi Buyer) Policy, which covers risks on all buyers through an aggregate loss limit, finding it inconvenient to get a separate policy for each buyer. The Multi Buyer policy does not cover exports to buyers in restricted countries or those under the buyers specific approval list.
Two types of exposure policies are offered by ECGC to large exporters: 1) Exposure (Single Buyer) Policy, which covers risks on a specified buyer through a separate policy for each buyer. 2) Exposure (Multi Buyer) Policy, which covers risks on all buyers through an aggregate loss limit, finding it inconvenient to get a separate policy for each buyer. The Multi Buyer policy does not cover exports to buyers in restricted countries or those under the buyers specific approval list.
Credit Insurance Policies Buyer Exposure Policies Presently, in the policies offered to exporters premium is charged on the export turnover, though the Corporations exposure on each buyer is controlled through a system of approval of credit limits on the buyer for covering commercial risks. While this suits the small and medium exporters, many large exporters having large number of shipments have been complaining about the volume of returns to be filed under the policy necessitating the deployment of their resources for this purpose and also resulting in possible unintentional omissions or commissions in such reporting, which have an impact on the settlement of claims. There has been a demand for simplification of the procedures as well as for rationalization of the premium structure. Considering the requirements of such exporters, the Corporation has decided to introduce policies on which premium would be charged on the basis of the expected level of exposure. Two types of exposure policies one for covering the risks on a specified buyer and another for covering the risks on all buyers- are offered. Two types of Exposure policies are offered, viz, Exposure (Single Buyer) Policy for covering the risks on a specified buyer and Exposure (Multi Buyer) Policy for covering the risks on all buyers.
What does an Exposure (Single Buyer) Policy cover?:
An exporter can choose to obtain exposure based cover on a selected buyer. The cover would be against commercial and political risks attached to the buyer for both non-LC and LC transactions. A separate Buyer Exposure Policy will be issued for each buyer covering all the exports to be made to the buyer during a period of twelve months. If the exporter has opted for commercial and political risks cover, failure of the LC opening bank in respect of exports against LC will also be covered, for the banks with World Rank (WR) up to 25,000 as per latest Bankers almanac. For covering the political risks only, in respect of LC transactions or shipments to associates, Buyer Exposure policy with endorsement restricting the cover to political risks only. This policy can be availed by exporters holding Standard Policy in respect of any of their buyers. Shipments to the buyers covered under Buyer Exposure Policies would be excluded from the purview of the Standard Policy. What is a Multi Buyer exposure based policy ( MBEP) ? In case of an exporter making exports to a large number of overseas buyer, finds it inconvenient either to apply for buyer (single buyer) exposure policy for all buyers or declare their exports shipment wise , it can avail cover through a MBE policy. Under the policy the exporter can take cover for all its credit term exports made to all buyers for aggregate loss limit ( ALL), in respect of commercial risks and political risks. Normally ALL sought under the policy should not be less than 10% of the total export turn over for applicable categories/ countries. The policy does not cover the exports to buyers in the countries which are in the restricted cover country (RCC) list maintained by the Corporation and buyers under the buyers specific approval list(BSAL) of the Corporation. The cover for L/c opening banks are also available for banks with World rank up to 25000 as per latest bankers almanac. Loss limit in respect of individual buyer/bank will be restricted upto 10% of ALL.
Do's and Don'ts
Single Buyer Multi Buyer To download the proposal form for SBEP, click here. 1/2 3/8/2014 ECGC
To download the proposal form for MBEP, click here.
Click here for list of Frequently Asked Questions on Buyer Exposure Policies (Stockholding Agent and Global Entity)