Page 244 - International Marketing

NPP

246 International Marketing BRILLIANT'S

5. Loss or damage to goods which can be covered by commercial
insurers.
6. Exchange fluctuation.
7. Discrepancy in documents.
(B) Specific Policies
The standard policy is a whole turnover policy designed to provide a
continuing insurance for the regular flow of exporter's shipment of raw
materials, consumable durable for which credit period does not normally
exceed 180 days.
Contracts for export of capital goods or turnkey projects or construction
works or rendering services abroad are not of a repetitive nature. Such
transactions are, therefore, insured by ECGC on a case-to-case basis
under specific policies.
Specific policies are issued in respect of Supply Contracts (on deferred
payment terms), Services Abroad and Construction Work Abroad.
1. Specific policy for Supply Contracts: Specific policy for Supply
contracts is issued in case of export of Capital goods sold on deferred
credit. It can be of any of the four forms:
 Specific Shipments (Comprehensive Risks) Policy to cover both
commercial and political risks at the Post-shipment stage.
 Specific Shipments (Political Risks) Policy to cover only politi-
cal risks after shipment stage.

 Specific Contracts (Comprehensive Risks) Policy to cover politi-
cal and commercial risks after contract date.
 Specific Contracts (Political Risks) Policy to cover only political
risks after contract date.
2. Service Policy:Indian firms provide a wide range of services like
technical or professional services, hiring or leasing to foreign parties (pri-
vate or government). Where Indian firms render such services they would
be exposed to payment risks similar to those involved in export of goods.
Such risks are covered by ECGC under this policy.
If the service contract is with overseas government, then Specific
Services (political risks) Policy can be obtained and if the services con-
tract is with overseas private parties then specific services (comprehen-
sive risks) policy can be obtained, especially those contracts not sup-
ported by bank guarantees.
Normally, cover is issued on case-to-case basis. The policy covers
90% of the loss suffered.