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Overseas Contractors

The private market for credit and political risk insurance can provide a variety of insurances to assist contractors when they are performing international construction and/or engineering projects. Policies can be placed to insure the repudiation or frustration of the contract, protect liabilities under contract bonds as well as protecting a contractor’s plant and equipment.

Contractual protection is available against the following risks:
  • Buyer non-payment
  • Non-payment by a guarantor or bank
  • Inability to exchange and remit funds from the buyers country
  • Failure of buyer to honour an arbitration award
  • Import or export licence cancellation
  • Imposition of import or export embargoes
  • Contract cancellation
  • Political violence (incorporating war, terrorism, strikes, riots and civil commotion)
  • Fair/Unfair calling of contract bonds (bid, advance payment, performance and warranty)
Comprehensive Contractors Plant and equipment Insurance can insure against the following risks:
  • Confiscation, expropriation and nationalisation
  • Deprivation (inability to re-export)
  • Physical damage due to political violence (including war, terrorism, strikes and civil commotion) and any resultant business interruption
Where required, the MarRS team can also assist in arranging contract surety bonds with appropriate insurers as an alternative to using bank guarantees.

Private Market vs Export Credit Agencies and Multinationals
Private market insurance can be used in conjunction with ECA/Multinational insurance or as an alternative. The advantages of private market insurance include:
  • The are no eligibility criteria such as foreign content or nationality
    of the insured
  • Superior policy contracts and scope of cover
  • Down payment structures can be insured
  • Responsiveness. Policies can be negotiated and finalised in
    very short timeframes
  • Flexibility to offer bespoke products
  • Premium rates are competitive
  • Contract bonds and/or Comprehensive Contractors Plant and
    Equipment covers can be insured in isolation
Project Finance
If the contractor requires bank finance, either on a project finance structure or an export finance structure, credit and political risk insurance can be arranged to protect the lending banks interest, either with the bank as the insured or loss payee.

There are no fees required to obtain a non-binding indication of terms.

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