Glossary
[ A ] - [ B ] - [ C ] - [ D ] - [ E ] - [ F ] - [ G ] - [ H ] - [ I ] - [ J ] - [ L ]
[ M ] - [ N ] - [ O ] - [ P ] - [ Q ] - [ R ] - [ S ] - [ T ] - [ V ] - [ W ]
A
Aggregate First Loss
Cumulative amount of your unpaid debts, stipulated in your credit-insurance contract, for which you are responsible during a policy period, with the surplus being subject to indemnification according to the limit of withdrawal.
Applicant
Somebody who want to secure credit with the assistance of a specialized broker.
Assignment of debt to a loss payee
With the Company's authorization, you can transfer the indemnities resulting from a credit-insurance contract to a bank or other financial establishment.
Assignment of payment
The case of companies which cannot cover their current liabilities with their available assets.
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B
Bill of Exchange or Draft
Document whereby a creditor (the drawer) gives his debtor (the drawee) an order to pay a certain sum on a given date (the due date), either to himself or to a third party (the beneficiary).
Bond
Commitment entered into towards a creditor by a third party which bears the name of Bond.
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.
Broker
Insurance intermediary between the Company and its policyholders. The broker's task is to prospect companies in order to propose credit-insurance contracts, and to represent the policyholder to whom he/she provides advice during the implementation of the contract and its daily management.
Buyer
Your client, your debtor in the commercial transaction.
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C
Cancellation
Decided by the company starting from administrative or legal criteria such as discontinuation of the drawee's business activities, leasing management, merger-absorption..., the coverage previously granted is removed.
Cause of loss
Situation or event likely to bring the coverage into play.
Claim
Occurrence of a risk falling into the field of application of the credit-insurance contract.
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.
Collection
Any settlement from your buyer made after the initial or extended due date. The collection can be spontaneous or subsequent to actions carried out with your buyer by the Company or by yourself.
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 the insurance company has to indemnify in case of claim.
Consignment
The shipment of merchandise to an agent, the consignee, for the purpose of their subsequent sale on the behalf of the shipper. The latter retains ownership of the merchandise until their sale.
Contract
Contract concluded between the exporter and his client.
Convertibility risk
Risk resulting from events occurring outside your country, or from a decision by foreign authorities which prevents or delays the transfer of the debt amount paid by your buyer.
Covered debt
Debt for which total or partial coverage has been obtained from the insurer.
Covered loss
Covered unpaid debt as defined in the contract, excluding interest.
Credit approval
Amount of the exposure guaranteed by the Company, at your request, for a specifically identified buyer.
Credit period
Payment term which you contractually grant to your buyer at the time of the sale.
Credit-Insurance
Technique allowing companies to be covered against the risk of the non-payment of their commercial debts.
Creditor
Natural person or company to whom a debt is owed. As opposed to a debtor.
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D
Debt
Amount owed by a buyer to a supplier of goods or services, pursuant to a sale contract.
Debtor
Natural person or company required to pay an amount of money in exchange for the performance of services or the sale of merchandise. As opposed to a creditor.
Debtor default
Default means that the debtor is unable to honor his obligations or backs out of honoring them for no legitimate reason.
Default (state of)
A buyer is considered to be in a state of individual default, as understood in the credit-insurance contract, if the said buyer's debt has not been paid on the initially contracted or extended due date.
Delivery
Making available to your buyer all of the merchandise in keeping with the provisions and the agreed location stipulated in the sales contract.
Disputed Request for Intervention
Formal request which you make to your Company for the purposes of an amiable or judiciary recovery of a debt which has remained unpaid at the end of a certain contractually determined time.
Due date
Contractual date whereupon your buyer must pay your invoices in compliance with the agreements signed between you and the buyer.
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E
Endorsement
Additional document modifying certain clauses of the origin contract
Excess
Technique allowing companies to be guaranteed against the risk of non-payment of their commercial credits.
Exposure
Amount equal to the debtor balance which, at any given moment, one of your buyers' accounts can represent in your accounting books. This amount depends on the unit value of the deliveries, their frequency and the granted credit period.
Extension period
Additional time, generally indicated in writing, which you grant to your buyer as of the due date of an unpaid debt.
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F
Factoring
Technique whereby a seller of goods or services can assign his professional debts from his buyers to a specialized organization, i.e. the factoring house, which looks after managing the invoice, as well as its collection and/or financing.
First sale (clause)
Special clause whereby the policy-holder receives minimum coverage for transactions carried out with a new private buyer who has not yet been approved by the company.
Friendly arrangement
Agreement given by a policy-holder to one of his customers to spread out the payment of its credit over several expiries or to authorize a handing-over partial of its debt.
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G
Globality (principle of)
The total turnover can be insured except public bodies, private individuals, affiliated companies, customers in state of default, customers who are not registered by trade register or trade repertory, customers refused by the company
Guaranteed proportion
Percentage up to which the insurance company covers a risk. The guaranteed share is applied to the indemnifiable losses to calculate the indemnity.
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H
Host country (investment policy)
Country where the investment is effected.
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I
Identified
Contractual threshold beyond which a policyholder must contact the insurer in order to obtain the coverage of individual outstanding amounts.
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.
Inclusiveness (principle of)
Obligation for the coverage to be applied to your entire insurable turnover.
INCOTERM
SEE End of list
Indemnifiable loss
Debit balance of the loss account, which is used to calculate the indemnity.
Indemnity Coverage
Percentage applied to the loss subject to indemnification in order to calculate the indemnity.
Indemnity Settlement
The insurer's payment of the indemnity due. The settlement corresponds with the covered loss to which the contractually indicated percentage has been applied.
Individual deductible per claim
Unit amount below which you remain responsible for any unpaid debts.
Insolvency
Inability of the debtor to pay its debts.
Insolvency in fact
Statement of fact bringing to conclude that a payment of the debtor, even partial, is unlikely.
Insolvency in law
Legally confirmed inability of the debtor to pays its debts.
Insurance period
Period of one year beginning on the date when the policy is signed.
Investment
Contribution made by the insured party to the local enterprise, as described in the Particular Terms.
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J
Judiciary Liquidation
Decision involving the immediate winding-up of a company.
Judiciary Receivership
Judiciary procedure decreed by a court against a company which has ceased to make payments. This procedure is intended to allow the company's activities to continue while clearing up its liabilities on the basis of a Court-approved plan.
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L
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.
Local company (investment policy)
Natural person or legal entity established in the host country, or the subsidiary or establishment in which the investment is made.
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M
Mandate to act
Document whereby the policyholder authorizes the insurer to collect his debts on his behalf.
Maximum liability
Maximum amount of the indemnities which the Insurer may be required to pay to you pursuant to covered losses occurring during a policy period.
Medium-/long-term
Credit period exceeding one year.
Moratorium
Arrangement made with all of the creditors relative to terms of payment.
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N
Non-guaranteed proportion
Portion not covered by the insurance company, for which the insured party has to assume exclusive responsibility.
Non-identified (client clause)
Contractual limit below which any exposure is automatically covered by the insurer.
Non-payment
Non-payment occurs when there is a failure to recover the sums due under the Contract within the waiting period.
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O
Orders to be delivered
Orders in hand whose invoicing and delivery have not yet taken place.
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P
Policy
Insurance contract (credit insurance or investment insurance) concluded between the exporter and the insurance company.
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.
Pre-disputed
Procedures undertaken by you and/or the Company in order to amiably recover a debt which has remained unpaid beyond its due date.
Premium category
Basic category used in the calculation of the insurance premium.
Private buyer
Any commercial entity which can be legally pursued by a creditor in an ordinary court and which, if necessary, can be forced into judicial liquidation.
Proportion of compensation
Proportion between the total amount of the debt at the time of indemnification and the actual amount indemnified.
Protocol
Agreement whereby a State or an official organization undertakes, relative to a foreign State or organization, to provide the financing for an exports program for a given amount and with identified credit terms.
Proxy
Person holding a mandate and who acts in the name and on the behalf of another person, referred to as the principal.
Public buyer
Buyer incurring the liability of the State.
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Q
Questionnaire
Document which you must fill out before the subscription of a contract of credit insurance or factoring
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R
Recoveries
All amounts recovered after indemnification in relation to the indemnified loss.
Reduction
Reduction of the amount of the coverage granted to one or more policyholder(s) for a given drawee.
Request for non-payment intervention
Possibility for the policyholders to have the Credit Insurer act as of the identification of an unpaid account, for the purpose of a quick and simplified approach to the debtor.
Risk of credit
Risk of non-payment
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S
Short-term
Credit period up to two years.
Solvency
Ability of a natural person or company to deal with the commitments made to creditors, i.e. to honor any debts.
Sovereign risk
Risk of default by the State itself, usually the Minister of Finance.
Special transactions
Special transactions payable on a cash basis are all transactions with a payment period not exceeding twelve months and involving constructional work, industrial complexes or engineering services.
Subrogation
Legal mechanism by which the insurance company, having indemnified the exporter, holds the exporters rights and shares and can rightfully exercise them against the debtor.
Surety
Guarantee granted to you by your buyer in order to ensure his payment.
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T
Temporary overrun
Additional exposure covered by the Company for specific time-limited shipments.
Threaten of claim
Is generated by the policyholder's mandate of covering of an unpaid credit remained at the due date.
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).
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.
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V
VAT
Vakue Added taxe = Registration number
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W
Waiting period
Period between the maturity date of the unpaid debt and the date when the policyholder can make the claim.
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INCOTERM
Incoterm CFR (Cost and Freight)
Title, risk and insurance cost pass to buyer when delivered on board the ship by seller who pays the transportation cost to the destination port. Used for sea or inland waterway transportation.
Incoterm CIF (Cost, Insurance and Freight)
Title and risk pass to buyer when delivered on board the ship by seller who pays transportation and insurance cost to destination port. Used for sea or inland waterway transportation.
Incoterm CIP ( Carriage and Insurance Paid To)
Title and risk pass to buyer when delivered to carrier by seller who pays transportation and insurance cost to destination. Used for any mode of transportation.
Incoterm CPT (Carriage Paid To)
Title, risk and insurance cost pass to buyer when delivered to carrier by seller who pays transportation cost to destination. Used for any mode of transportation.
Incoterm DAF (Delivered at Frontier)
Title, risk and responsibility for import clearance pass to buyer delivered to named border point by seller. Used for any mode of transportation.
Incoterm DDP (Delivered Duty Paid)
Title and risk pass to buyer when delivers goods to named destination point cleared for import. Used for any mode of transportation.
Incoterm DDU (Delivered Duty Unpaid)
Title, risk and responsibility of import clearance pass to buyer when seller delivers goods to named destination point. Used for any mode of transportation. Buyer is obligated for import clearance.
Incoterm DEQ (Delivered Ex Quay - Duty Paid)
Title and risk pass to buyer when delivered on board the ship at the destination point by the seller who delivers goods on dock at destination point cleared for import. Used for sea or inland waterway transportation.
Incoterm DES (Delivered Ex Ship)
Title, risk, responsibility for vessel discharge and import clearance pass to buyer when seller delivers goods on board the ship to destination port. Used for sea or inland waterway transportation.
Incoterm EXW (Ex Works)
Title and risk pass to buyer including payment of all transportation and insurance cost from the seller's door. Used for any mode of transportation.
Incoterm FAS (Free Alongside Ship)
Title and risk pass to buyer including payment of all transportation and insurance cost once delivered alongside ship by the seller. Used for sea or inland waterway transportation. The export clearance obligation rests with the seller.
Incoterm FCA (Free Carrier)
Title and risk pass to buyer including transportation and insurance cost when the seller delivers goods cleared for export to the carrier. Seller is obligated to load the goods on the Buyer's collecting vehicle; it is the Buyer's obligation to receive the Seller's arriving vehicle unloaded.
Incoterm FOB (Free On Board)
Title and risk pass to buyer including payment of all transportation and insurance cost once delivered on board the ship by the seller. Used for sea or inland waterway transportation.