What is Trade Credit Insurance?

Trade Credit Insurance is also known as Nonpayment Insurance (NPI) or Accounts Receivable Insurance.

If you are a company selling products or services on credit terms, or a financial institution financing those sales, you are providing trade credit. When you provide trade credit, nonpayment by your buyer or borrower is always a possibility. FCIA’s Trade Credit Insurance products protect your accounts receivable against losses resulting from that nonpayment.

A debtor's nonpayment can be caused by commercial events such as insolvency or protracted default. On international transactions, nonpayment can also result from the occurrence of disruptive political events such as wars, government interventions, or currency inconvertibility. All FCIA Trade Credit Insurance policies provide comprehensive coverage against nonpayment risk arising from commercial and political events.

Trade Credit Insurance or Nonpayment Insurance (NPI) can be a cost-effective mechanism for transferring risk. Premiums are generally charged either as a percentage of sales or as a per annum rate on limits. Premium rates are influenced by various factors including country risk, obligor risk, length of payment terms, and your loss experience.

What is Political Risk Insurance?

Operating in foreign countries, especially in emerging markets, can expose your company to additional risks related to unpredictable foreign government acts or political events. FCIA offers an array of political risks coverage that can help protect your investment in foreign countries.

Political Risk coverage protects you against loss in value of your foreign investments or assets resulting from specified political events during the policy period in the country where the investments or assets are held.

These policies insure against losses due to named political events related to:

  • Equity Investments
  • Shareholder Loan
  • Mobile Assets