The British Insurance Brokers' Association (BIBA) has entered into agreement with the Government's Export Credits Guarantee Department (ECGD) to provide general insurance brokers with access to the ECGD export insurance scheme for their clients.
Under this agreement, brokers can access the scheme to insure UK exporters against non-payment by their overseas buyers.
Till now, access to this government backed insurance scheme has only been available direct from the government to businesses.
BIBA said a sub group of the BIBA Trade Credit Risk Focus Group were engaged with senior executives of ECGD to re-work the current Export Insurance Policy (ExIP) wording to provide adequate support for exporters and also can be used to obtain trade finance.
Credit insurance complements existing insurance to cover transit of goods from UK businesses to buyers so that if there is a failure to pay for the goods, the credit cover compensates the exporter for their loss of sales income.
The recently published government’s white paper Trade and Investment for Growth revealed that ECGD would be able to offer short term export credit insurance for all types of goods. This will provide a one-off cover with a minimum contract value of £20,000.
Specialist credit insurance broker Perkins Slade will be wholesaling the scheme to the wider BIBA membership.
Perkins Slade associate director Sally Del Principe said that on behalf of the Trade Risk Focus Group, Perkins Slade is delighted with the agreement, and for convincing ECGD to use the broking channel to distribute the product. This will open doors for SME exporting businesses to trade with confidence in non-OECD territories.