A Typical Sequence of Events – Credit Insurance in Five Steps

ASHRA can assist you and your company from your first contact with a buyer abroad to the end of the export transaction and reception of payment.
Here you can discover the typical sequence of events when issuing a credit insurance application: what do you need to do, how can ASHRA help and assist you with your export on its way, and what assistance can your bank provide you with.

First step: Contacting the buyer abroad
What do you need to do
You initiate contact with the buyer abroad and clarify what you are intending to supply, the size of the order, the delivery specifications and the payment method the buyer is to use. Payment typically comprises an advance payment, a payment on delivery and\or payments during the guarantee period, after completion of deliveries.
Contact ASHRA to find out how we can assist you with financing before you arrange the payment method.
Please contact us in advance so we can give you the most effective assistance while relating to payment and credit terms relevant to your transaction.
What ASHRA does
ASHRA helps you with its expertise on financing export transactions and by creating unique insurance solutions to protect your company or the bank you are working with against losses due to non-payment by the buyer.
ASHRA can also inform you on conditions in countries and markets around the world.
What the bank does
The bank will let you know of the options available to your company and to your buyer for obtaining credit or for obtaining a loan for the export order, and will explain them to you.

Second step: Determining the financing requirement
What do you need to do
You need to describe the export transaction for ASHRA: the size of the order, what services or goods you are exporting, what are the credit terms you want to offer your buyer and what form of payment and collateral credit is due.
Contact ASHRA in advance to ensure that the conditions applying to your export transaction match our insurance conditions.
What ASHRA does
ASHRA helps you find the right way to protect your company and\or the bank against losses, so that the financing can be finalized in the best way possible. ASHRA's policies insure, for example, against the buyer being unable or unwilling to pay for the export as agreed, and/or against political events that may result in non – payment over the transaction.
What the bank does
The bank assists you and your company determine the credit, the possible financing terms, the collateral required and the export documents required for the export transaction.

Third step: Credit assessment of the export transaction
What do you need to do
When the transaction is made in the way of giving your buyer credit without collateral (without a letter of credit or the buyer's bank guarantee), you should supply ASHRA with the last three annual financial statements of your buyer so that ASHRA would be able to make credit assessments. You may also supply ASHRA with any additional information relating to the transaction, which may help with the assessments.
What ASHRA does
ASHRA evaluates the financial strength and repayment ability of your buyer, and also the economic and political situation of the buyer's state. Finally, if the risk is acceptable, ASHRA will then provide you with a letter of approval for the risk covering.
What the bank does
The bank uses ASHRA's letter of approval to make the final financing offer, which you will be able to present to your buyer.

Fourth step: ASHRA issues the guarantee
What do you need to do
Your company signs a request for a ASHRA's policy that contains, among other things, a declaration on non-bribery and transparency.
What ASHRA does
ASHRA prepares and issues the policy to your company or the bank, as determined.
What the bank does
The bank makes sure that the policy is consistent with its requirements and allows it to finance the transaction. The bank then sends ASHRA the documents required for the policy to become valid.

Fifth and final step: The export takes place
What do you need to do
Your company starts carrying out the export transaction - following the transaction's conditions delivering to the buyer.
What the bank does
The bank pays your company for the export transaction against presentation of shipping documents and the relevant approvals from the buyer. Payment in advance Payment on delivery and post-delivery period payments are set out in the financing agreement. The bank then receives credit repayments from the buyer, in accordance with the terms of the financing agreement. The repayment terms are usually determined for a period of several years.  For large scale transactions the credit period may reach 10 years or even more. For smaller scale export transactions the credit period will usually lasts 3 to 5 years.
What ASHRA does
As defined in the policy, when an insurance event happens ASHRA pays compensation to your company or the bank if payments are not made in accordance to what was agreed upon when planning the transaction.