Specific Policy (Contracts / Constructional Works / Services)
Specic Policy (SP) is a form of credit insurance that insures Malaysian exporters who undertake contracts for export of capital goods, turnkey projects, construction works, or rendering of services abroad against the risks of nonpayment by the overseas buyer.
The Specific Policy applies to individual contracts and provides coverage either from the date of contract or from the date of shipment. During the pre-shipment period, the exporter is covered against loss due to the insolvency of the buyer or frustration of the contract from causes beyond his control and that of his buyer. Whereas, after the shipment, he is covered against loss caused by non-receipt of payments due to Commercial Risks, Economic Risks, Political Risks and Unforeseeable Events.
- Buyer insolvency
- Payment default by buyer within 6 months of goods delivered and accepted
- Blockage or delay in payment transfer
- Imposition of import restrictions
- Cancellation of valid import license
- Occurrence of war between buyer’s country and Malaysia
- Occurrence of war, hostilities, revolution or other similar civil disturbances in the buyer’s country
- Any other causes of loss occuring outside Malaysia, which are beyond the control of either the exporter or the buyer
Contracts must be:
- A one-off project/contract
- Non-repetitive in nature
- Lengthy in terms of manufacturing/project period
Up to 90% for commercial risks and 95% for political and country risks.
All shipments made under contracts concluded on payment terms of ILC, DP, DA and OA are acceptable.
Premium rates primarily depend on EXIM Bank’s grading of the market with which the business is done and terms of payment. In general, the premium is dependent on market risk and credit terms.
The following are payable:
Processing Fee: RM1,000 per application
The protection/cover starts either from the date of the contract or from the date of the shipment.
Causes of Loss & Claims Waiting Period
- Buyer’s insolvency:
- Default in payment:
6 months after due date of payment
- Non-acceptance of goods:
1 month after goods are resold
- Transfer delay:
4 months after deposited payment in selected currency
4 months after date of occurrence