Trade Credit Insurance can cover sales made to overseas customers as well as customers within Australia.

This is commonly referred to as export credit insurance.

What can export Trade Credit Insurance cover? #

Depending on the policy, cover can respond where an overseas customer fails to pay because of:

• Insolvency.
• Protracted default.
• Other insured non-payment events.
• Certain political or country risks.

The exact cover depends on the policy and countries involved.

What are political risks? #

Some Trade Credit policies can be extended to cover certain events outside the customer’s control that prevent payment.

These can include matters such as:

• Government action.
• Currency transfer restrictions.
• Political instability.
• War or civil disturbance.
• Import or export restrictions.

These risks are not automatically covered by every policy.

Does every country qualify for cover? #

No.

Insurers continually assess country and buyer risk and may:

• Restrict cover in particular countries.
• Apply lower credit limits.
• Apply additional conditions.
• Exclude certain territories.
• Withdraw cover where circumstances deteriorate.

Businesses expanding into overseas markets should confirm cover before substantially increasing their exposure to a buyer.

What information might be required? #

The insurer may need details of:

• The overseas buyer.
• Country involved.
• Expected sales.
• Maximum credit exposure.
• Payment terms.
• Trading history.
• Currency.
• Goods or services supplied.

Export businesses should also ensure they comply with any documentation requirements applying to overseas claims.