Medium- and Long-Term Export Credit Insurance

With regards to the three ML/T insurance programs mentioned below, premium amount is calculated in accordance with a specific formula set by Türk Eximbank taking into consideration several risk variables. The rates would vary according to the risk classification of buyer's country, payment terms, credit length, legal status of the debtor, additional guarantees (or collaterals) provided by the debtor (or debtor's country) such as, sovereign guarantee, escrow account, etc. Leaving no doubt that the magnitude of the transaction would be a crucial variable for premium amount setting.

Waiting period for any kind of losses to be ascertained is 6 months (unless otherwise is stated in writing) in all ML/T programs.

ML/T policy proceedings are also assignable and Türk Eximbank could issue an unconditional (in comparison to the insurance treaty) letter of guarantee in favor of financing banks (financial institutions) upon request, on the case-by-case risk assessment.

1. Specific Export Credit Insurance Program

This program, introduced in 1990, provides exporters with comprehensive pre- and post-shipment insurance cover against commercial and political risks for the exports of capital and/or semi-capital goods, having at least 60% domestic content and sold on credit terms up to 5 years.

This is a single-buyer, multi-shipments insurance program providing cover against political and commercial risks. Cover is given up to 95% (insured's retention would be 5% to 20% depending on the risk profile of the whole transaction) of 85% of the contract value. Repayments should be realized in 6-monthly or more frequent "equal installments" after 15% down payment for credit terms in excess of two years, in accordance with the "OECD Consensus".

This Program also enables exporters to obtain funding from commercial banks at favourable terms.

2. Specific Export Credit Insurance Post-Shipment Political Risk Program

This program, initiated in 1996, is a "single buyer, multi-shipments" insurance program providing cover merely against political risks in post-shipment period for the export receivables emerging from sales on credit terms up to 5 years. Eligible export goods are considered as capital and/or semi-capital goods with at least 60% domestic content.

Policy proceedings are assignable for financing purposes. As for the said Program, coverage would be up to 95% (or less) of 85% of the contract value and 15% of the contract value has to be paid in advance.

3. Specific Export Credit Insurance Post-Shipment Comprehensive Risk Program

This program, introduced in 1997, is as well a "single buyer, multi-transactions" insurance program providing extended cover against both political and commercial risks in the post-shipment phase for the receivables emerging from sales on credit terms up to 5 years. Above-mentioned type of goods are considered as eligible for this program.

This program also enables exporters to obtain funding from commercial banks at favourable terms. The percentage of cover would be up to 95% (or less) of 85% of the contract value and 15% of the contract value has to be paid in advance.

Last saved: July 07, 2005

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