Export Credit Insurance

Export Bahrain in partnership with the Arab Investment & Export Credit Guarantee Corporation “Dhaman” introduced the first export credit solution in the Kingdom of Bahrain, to protect Bahraini exporters against a range of risks that might rise due to involvement in international transactions.

Export Credit Insurance solution reduces the payment risk and provide exporters with conditional assurance that payment will take effect if the foreign buyer is unable to pay. In that regard, Dhaman will reimburse 90% of the payment in case of default. This will encourage exporters to offer more competitive credit terms while controlling the risk of default on payment.

Export Bahrain will subsidize 80% of the premium rate.

Eligibility Criteria

  • A company with an active Bahraini Commercial Registration in the Kingdom of Bahrain.
  • Startup and growing companies with revenues below BHD 3,000,000.
  • To meet minimum standards of local production, goods manufactured or processed.

Terms & Conditions*

Exporters are required to:

  • Submit monthly export reports to Dhaman.
  • Settle the insurance premiums within 10 working days of the insurance invoice date.
  • Notify Dhaman of any overdue within two months from the maturity date of the insured debt.
  • To meet minimum standards of local production, goods manufactured or processed.

*Other terms and conditions apply as per the signed insurance contract.

Please fill in the application to benefit from this solution.

Frequently Asked Questions

Export credit insurance protects the exporter against both commercial and political risks and facilitates trade by allowing exporters to sell goods and services without having to worry about not being paid by their customers. In return for accepting to bear this payment risk, the credit insurer charges the exporter an insurance premium.

Export Credit Insurance allows applicants to:

  • Be more competitive in international markets by offering better sales conditions such as longer credit terms and flexible instruments of payment.
  • Retaining existing customers and entering new markets without worrying about not being paid.
  • Protecting your financial position by getting adequate compensation from your credit insurer in case of default of the buyer.
  • Mobilizing working capital from your bank to finance transactions. Your bank will be the loss payee under the credit insurance policy.
  • Prevention and effective Credit Risk Management by verifying the creditworthiness of your present and new customers and protecting you in the event of a default payment.

Export credit insurance covers two types of risks:

  • The commercial risks: bankruptcy or protracted default of the importer. They are related to the importer and its creditworthiness.
  • The political risks also called non-commercial risks: they are related to the country of the importer and they include war, civil disturbances, transfer restrictions, moratorium on external debt, confiscation, expropriation and nationalization, default of a public buyer.
The export credit insurer will pay the exporter 90% of the insured loss.

Export credit insurance companies cover the risk of non-payment. Factoring companies buy receivables with or without recourse on the exporter in case of default of the importer. Most of the factoring companies are backed by export credit insurance companies.

The cost of export credit insurance is determined by a number of factors mainly the turnover to be insured, the sector of activity, the number of importers to be insured, the instruments of payment, the tenor, the importing countries’ risk.

Credit Information companies provide reports on buyers across the globe that includes financial, commercial and legal data. The credit information reports provided by these agencies are used by the credit insurance company – alongside other data – to assess the importers’ creditworthiness and fix credit limits for them.

Export credit insurance is strictly confidential. This means that neither the credit insurer nor the exporter are allowed to disclose the existence of the credit insurance policy to the importer.

Commercial litigation and disputed invoices, non-compliance of the exporter with the terms and conditions of the export contract, sales made during any period in which the credit insurance was suspended, damages to or diminution of the delivered goods.

Claims are submitted by completing a simplified Loss Notification Form and providing the relevant unpaid invoice and shipping documents.

Compensation is paid after the expiry of the waiting period, i.e. after 30 days in case of bankruptcy of the importer or 180 days in case of protracted default of the importer or in case of political risks.

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