Trade credit and political risk insurance

Asia Pac Trade Credit 

Credit is vital to the commercial world. Markel International’s trade credit cover promotes trade by ensuring that buyers and sellers can do business with confidence. The team has a wealth of experience worldwide and helps to control counterparty payment default risks.

Buyers and sellers have long relied on credit to facilitate trade but never more so than in today’s global marketplace where supply and demand are founded on increasingly complex credit arrangements. However, where credit is involved, there are also counterparty risks. What happens if a buyer defaults on payment before meeting its commitments through insolvency or for other reasons? Non-payment can have a devastating effect on the balance sheet, which is why trade credit insurance is essential for business security and confidence.

The trade credit team offers expert knowledge of commercial counterparty and country risks across a wide variety of trade sectors. The key benefits for clients include: security of non-cancellable credit and country limits; balance sheet and cash flow protection; improved terms for bank financing facilities; an effective alternative to letters of credit or other types of collateral; reduced need for bad debt reserves; increased potential for sales growth to new and existing buyers because credit is based on a firm foundation; and risk transfer to satisfy capital adequacy requirements.

Markel's trade credit and political risk team offers expert knowledge of commercial counterparty and country risks across a wide variety of trade sectors. The key benefits for clients include: security of non-cancellable credit and country limits; balance sheet and cash flow protection; improved terms for bank financing facilities; an effective alternative to letters of credit or other types of collateral; reduced need for bad debt reserves; increased potential for sales growth of new and existing customers because credit is based on a firm foundation; and risk transfer to satisfy capital adequacy requirements.

CALL US ON:
Singapore
+65 6388 3000
Hong Kong
+852 3180 2262

India
+91 2240 907078

China
+86 21 61628279

Risks covered:

- Commercial perils:

    • Insolvency
    • Default

- Political risk perils*

    • Currency inconvertibility & non transfer
    • Government action
    • Import/export licence  cancellation
    • Public buyer default
    • War
 

Typical structures

- Excess of loss: multi-buyer (typically includes discretionary credit limit)

- Excess of loss: specific or named buyer (no discretionary credit limit facility)

- Ground up: specific or named buyer (no discretionary credit limit facility; includes indemnity percentage risk-share)

All of the above can be written as 'losses occurring' or 'risks attaching'

 

Typical products:

  • Excess of loss/ground up
  • Multi/named/single buyer
  • Financial institutions 
    • Vendor/buyer financing
    • Factoring/invoice discounting
    • Trade receivable securitisation
    • Risk transfer for capital relief
  • Contract replacement – energy products
  • Anticipatory credit/Advance payment insurance
  • Captive reinsurance
  • Pre-shipment credit
  • Contract frustration
  • PRI (Political Risk Insurance)
  • Non-trade

Trade credit key contacts

Dillon Matthews

Underwriter and Senior Risk Analyst, Trade Credit and Political Risk, Asia

email

Nicholas Davies

Underwriter and Senior Risk Analyst, Trade Credit and Political Risk, Asia

email

Alexander Holcroft

Political Risk Underwriter, Trade Credit and Political Risk, Asia

email