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A company is exposed to several risks when selling their goods overseas. Causes of non-payment which are of no fault of the seller can usually be covered by insurance. Whilst credit insurance can be used to enhance the quality of the source of repayment, being the buyer and their country, the financier relies upon the terms, conditions and extent of cover provided, and the client’s compliance with the requirements of the policy.
This chapter describes the key aspects of the contract of insurance which need to be evaluated prior to the release of finance, to include the insured percentage, deductibles, type of cover, maximum annual policy limit and the terms, conditions and restrictions.