Forms of Short-term Financing/Other Guarantees Linked with an Export Product
Other Guarantees Linked with an Exported Product
The export insurer provides other types of insurance:
- A global insurance for corporations having subsidiaries abroad. For companies trading internationally, there is a growing trend for overseas sales to be made not from the head office but through a local subsidiary. The export credit insurer may offer a comprehensive and flexible credit risk management service by providing, through their international network, a cover concerning the local sales of the subsidiaries as well as the head office exports sales.
- Manufacturing risk guarantee or work in progress. The insurer can provide a guarantee concerning the goods when they are at the stage of being manufactured. This guarantee protects the exporter against the risk of bankruptcy of the importer or against political/economic risk during the time of manufacturing (before completion and the sale).
- Bid bonds or performance bonds or advance payments, or retention bonds or guarantees. These guarantee to protect the exporter against any unfair first demand call on those bonds.
- Goods exposed in foreign political upheaval are guaranteed against the political or catastrophic risk for a maximum of six months.
- Goods in a consignment stock could be insured for a period of 12 months.
- Export insurance could be extended as well to the exporter abroad on his behalf. The guarantee is applicable on the final buyer risk.
- Protection of the investment abroad. A corporation can insure its new production unit in a foreign country against the political cause of loss: expropriation, war, non-transfer.
- Other coverage, such as, supplier default, breach of contracts, trade fair insurance, etc.