It's a good idea to consider insurance against non-payment by overseas customers. Exporting can restrict your cashflow and a delayed or lost payment can have serious consequences. Getting the right insurance can help minimise the impact if problems occur.

You will need to factor the cost of insurance into your pricing. While this may make your price higher, if you are concerned about non-payment it could be a false economy to discontinue your insurance in order to make your pricing more competitive.

The form of insurance will depend on the type and value of business you are conducting overseas. Payment insurance is only one form that you should consider to protect your interests.

Commercially available insurance

This is available for all exporters who export goods or materials on cash or credit terms of up to two years. There is a variety of cover options available, from coverage for all export activities through to one-off transactions. It's a good idea to shop around as the sector is quite competitive.

Government-supported insurance

The Export Credits Guarantee Department (ECGD) provides export credit insurance for the supply of capital goods, services and construction projects.

 

( liyy )18 Jan,2011

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