LEXICON
breach of contract
claim-generating event
commercial risk
commitment
contract
credit limits and "contract by contract"-cover
debtor default
globality (principle of)
government action
guaranteed proportion
ILC
imputable commitment
indemnifiable loss
indemnity
limit on the size of individual transactions
loss account
non-guaranteed proportion
non-payment
policy
political risk
premium category
proportion of compensation
recoveries
sovereign risk
subrogation
transfer of the entitlement to indemnities
transfer risk
waiting period
breach of contract
Cancellation is brought about when the execution of the Contract is interrupted for a 6-month period following the occurrence of a claim-generating event as mentioned in the policy.
claim-generating event
Situation or event mentioned in the policy which, by causing the non-payment of the debt or cancellation of the contract, can bring the guarantee into play.
commercial risk
Risk resulting from the deterioration of the debtor's financial situation, leading to the impossibility to pay the debt.
commitment
Amount at risk that Ducroire | Delcredere SA.NV has to indemnify in case of claim.
contract
Contract concluded between the exporter and his client.
credit limits and "contract by contract"-cover
Cover of short-term export credits is usually done within the framework of credit limits on individual buyers. The credit limit is the maximal amount Ducroire | Delcredere SA.NV is ready to cover on a specified buyer, regardless of the number of transactions made with this buyer. The policyholder is extended a sort of "ceiling per buyer" and has to report to Ducroire | Delcredere SA.NV on its deliveries to enjoy automatic cover for the related amounts up to the allocated ceiling. For some countries, Ducroire | Delcredere SA.NV is not ready to issue credit limits even though it is open for cover on the country. Decisions are then made on a contract by contract basis.
debtor default
Default means that the debtor is unable to honour his obligations or backs out of honouring them for no legitimate reason.
globality (principle of)
Obligation to subject the exporter's entire turnover or a group of contracts and risks to insurance, agreed with Ducroire | Delcredere SA.NV and defined in the policy.
government action
These are local authorities' decisions, deficiencies and impairments that are of an arbitrary and discriminatory nature.
guaranteed proportion
Percentage up to which Ducroire | Delcredere SA.NV covers a risk (limited to maximum 98 % for political risk and 90 % for commercial risk, brought up to 95 % in case of bank guarantee). The guaranteed share is applied to the indemnifiable losses to calculate the indemnity.
ILC
Irrevocable Letter of Credit.
imputable commitment
Commitment charged on the country ceiling. These are all commitments insured against non-payment and/or transfer risks.
indemnifiable loss
Debit balance of the loss account, which is used to calculate the indemnity.
indemnity
All indemnities are calculated by applying the guaranteed share to the debt balance in the loss account.
limit on the size of individual transactions
Maximum acceptable amount of imputable commitments related to each insured transaction on a country. That amount should always be considered as purely indicative.
loss account
Enables the definition of the indemnifiable loss, including
> or non-payment claims: as a debit the unpaid amount of the claim and as a credit any sum collected in connection with the insured claim, in particular following the realisation of securities or resale of recovered goods.
> for cancellation claims: as a debit the amount of the costs incurred in implementing the contract from the time of its conclusion and as a credit all amounts collected with regard to the insured contract.
non-guaranteed proportion
Portion not covered by Ducroire | Delcredere SA.NV, for which the insured party has to assume exclusive responsibility.
non-payment
Non-payment occurs when there is a failure to recover the sums due under the Contract within the waiting period.
policy
Insurance contract (credit insurance or investment insurance) concluded between the exporter and Ducroire | Delcredere SA.NV.
political risk
Any event occurring abroad which assumes the nature of force majeure for the insured or for the debtor, such as in particular, wars, revolutions, natural disasters, currency shortages, government action.
premium category
Basic category used in the calculation of the insurance premium.
proportion of compensation
Proportion between the total amount of the debt at the time of indemnification and the actual amount indemnified.
recoveries
All amounts recovered after indemnification in relation to the indemnified loss.
sovereign risk
Risk of default by the State itself, usually the Minister of Finance.
subrogation
Legal mechanism by which Ducroire | Delcredere SA.NV, having indemnified the exporter, holds the exporters rights and shares and can rightfully exercise them against the debtor.
transfer of the entitlement to indemnities
The profit from the insurance, that is to say, the right to receive indemnities in the event of a covered claim, can be transferred to a third party (for example the bank financing it) on agreement from Ducroire | Delcredere SA.NV.
transfer risk
Risk resulting from an event or decision by foreign authorities that prevents the transfer of the amount of the debt paid by the debtor.
waiting period
Period between the maturity date of the unpaid debt and the date when the policyholder can make the claim.