Credit Insurance Parameters

 

Short-Term

Multi-

Buyer / Single-Buyer Policy

 

Purpose

To assist U.S. exporters increase international sales by extending open account payment terms to foreign buyers of consumer goods, materials, services, small capital goods, consumer durables, and bulk commodities

Policy Period

12 months (renewable upon request)

 

 

Coverage Eligibility

- Single-Buyer - single or multiple shipments to one buyer on credit terms (documentary collections, unconfirmed letters of credit, and open account credit terms)

- Multi-Buyer - multiple foreign buyers on credit terms (documentary collections, unconfirmed letters of credit, and open account credit terms)

- Repayment terms up to 180 days depending on the export item or service; exceptionally up to 360 days for qualifying transactions such as capital equipment and bulk unprocessed agricultural commodities

 

 

Coverage Risks

- Covers commercial losses insolvency of the buyer, bankruptcy or default, and political losses war, terrorism, revolution, nationalization, currency inconvertibility, etc.

- Percentage of coverage: 100% sovereign obligors, 90% private sector and non-sovereign obligors, 95% letter of credit transactions, 98% bulk agricultural transactions

- For an additional premium, the exporter may request pre-shipment coverage

Premium Rates

- Determined by several factors including: length of terms offered, buyer type, spread of country risk, transaction type, and previous export experience

- Often incorporated into the selling price

 

Medium-Term Policy

Purpose

To promote the sale of U.S. capital equipment, its installation and a complement of spare parts if necessary

Repayment

1 to 5 years (exceptionally 7 years) and for amounts up to $10 million

Coverage Eligibility

- Single Sales one time transactions; and Repetitive Sales ongoing relationships, generally between an exporter and a dealer or distributor

- A minimum cash advance payment of 15% of the export contract value is to be paid by the buyer before the starting point of the credit

- Sales to dealers or others for resale are limited to maximum credit terms of 2 years

Coverage Risks

- Covers commercial losses and political losses

- Covers 100% of the 85% financed portion of the U.S. contract price

Premium Rates

Calculated on the financed portion of the medium-term shipments made during the period

This is not an export insurance coverage policy. It is a descriptive summary of the indicative policy parameters. The complete terms and conditions of the policy are set forth in the policy, applications, and endorsements

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