We work directly with the entire credit and political risks market, that is, approximately 50 insurers.
Our Lloyd’s broker accreditation allows us to access Lloyd’s syndicates without intermediaries, as do the large international insurance companies.
This competitive market is constantly evolving. Its theoretical capacity now exceeds 2 billion dollars per operation for coverage periods of up to 15 years.
In order to find alternative coverage and longer coverage periods, we also work with multilateral insurers namely MIGA, ATI and ICIEC as well as having partnerships with several export credit agencies – ECA, such as Bpifrance Assurance Export, Credendo, Acredia, Sace …
Exporters are confronted with a rise of political and commercial risks in their international contracts.
Our lengthy experience and understanding of their needs allows us to negotiate with insurers customised insurance coverage, adapted to the terms of each contract for public and private debtors.
Contract preshipment risks
In the event of an impossibility in the execution of the contract, our policies cover the exporters production costs:
- Breach of contract
- Embargo, war, political violence and foreign government actions
- Wrongful call advance payment bonds, performance bonds, retention bonds
Bonding facilities
We provide our clients with an alternative to the banking market for their contract bonds, in working with large international insurance companies to issue facilities.
> Case StudyNon-payment
We provide support to our exporter clients in order to have their counterpart risks secured, whether the risks be commercial or political:
- Non-payment following a default in payment or buyer insolvency
- Non-honouring of payment guarantees or letters of credit issued by governments, banks or parent company
- Non-convertibility/non-transfer of currency
Case Study
An exporter signs a contract with a a private foreign buyer. Following the financial default of the latter, the exporter is faced with a series of non-payments. The commercial risk coverage allows it to be indemnified up to the amount of outstanding receivables.
- Platus worked with the exporting company to help it to both analyse the amount of its risk as well to assist in the follow-up of the evolution of the contract and the information of the insurers.
- Platus also helped its client in the management of the claim file in order that it obtain from the insurers, without delay, the entitled indemnification.
- Platus, after having selected the insurers, managed from beginning to end, the information chain between its client and the insurers. It defended the assured’s interests throughout all the stages of the assured’s file.
Case Study
A civil works company signs a contract with a company in an emerging country for the construction of a factory and mobilised on-site equipment. A civil war breaks out and the contractor is obliged to abandon the building site. Thanks to the coverage of contract interruption and the policy guaranteeing the building site material, the assured’s expenditure losses were indemnified as well as the replacement value of on-site materials left behind.
- The complexity of this type of contract and the risks involved, led Platus to draft tailored insurance policies.
- Having managed to deal with the emergency, Platus obtained the nomination of an expert prior to the expiration of the claims waiting period, which allowed for the acceleration of the indemnification process.
The significant amounts at stake and the volatility of commodity market prices require the setting up of solutions of risk transfer at the moment of purchase, sale or storage.
We put our reactivity and our experience at the service of our trader clients in order to structure as quickly as possible the appropriate coverage for the different cycles of their activity.
We have protection put in place to protect the traders from risk of their counterpart, whether it is a question of commercial or political risks.
Non-payment
- Non-payment following a default in payment or buyer insolvency
- Non-honouring of payment guarantees or letters of credit issued by governments, banks or parent company
- Non-convertibility/non-transfer of currency
Non-performance (insurance prepayment)
- Non-reimbursement of funds prefinanced following the non-delivery of products
Political Risk and Violence
Our coverage of raw material inventory protects our clients against arbitrary actions by governments and political violence against their inventory (see also Investors)
> Case StudyCase Study
A trader in cotton wishes to protect his supply sector, to improve the quality of the delivered product and to be able to evidence its implication in the areas of social and environmental responsibility. To do so, it proposes to the production, transformation and storage sector, a partnership with a prefinancing of inputs and support throughout the process of each delivery of cotton fiber. It is faced with certain risks: agricultural, primary transport from the fields to the factories, sanding, transformation, transport to the factory or the port of shipment materialised by a risk of non-delivery of the quantity, quality and timelines agreed upon.
- Platus set up a facility covering the trading company against the risk of non-delivery by the sector partner, which protects it against political risks or partner failure, allowing also for the protection of the activity and the mastering of its own financial needs.
Committed to international operations, investors are confronted with a large range of risks. Threats are linked to a decision of public powers or a political situation arising from a political risk. The occurrence of this type of event generates damaging financial consequences for the company.
In order to allow them to master and fully apply themselves to their activity, we have secured the physical assets and equity participation of our clients abroad.
Risks covered
We have covered the investments against financial consequences resulting from the following situations:
- Confiscation, expropriation, nationalisation of assets
- Non-convertibility/non-transfer of currencies
- Revocation of licences or permits
- War, civil war, attacks, riots, terrorist acts…
- Forced abandonment
- Selective discrimination
- Forced divestment
Case Study
An international group invests in a copper mine but the government decides to nationalise the sector, depriving definitively the assured of its investment. The “investment insurance” policy will indemnify the international group of the loss of its assets, its dividends and its operational losses due to business interruption.
- Platus drafted an insurance policy, notably clauses defining the modalities of asset valuation and the business interruption losses.
- Platus also played its role in the claim management file. Role that it subsequently pursued in assisting its client in the recovery actions against the local authorities.
In order to protect against political risks and default (non-payment , non-honouring of guarantees or letters of credit), while alleviating the regulatory demands in terms of equity capital, banks regularly have recourse to the private insurance market.
We make use of the market competition in order to obtain the best coverage levels and price conditions and support the banks in their international financial activities.
Political Risks
We structure our insurance policies to respond to political risks of:
- Confiscation, expropriation, nationalisation of assets
- Non-convertability/non-transfer of currencies
- Political violence/War
- Sanctions
Non-payment (comprehensive non-payment)
Our coverage protects banks against default, refusal or incapacity of their counterparts to reimburse a debt on the due date.
> Case StudyCase Study
A company negotiates a contract with a foreign buyer, who conditions his signature on the offer of financing by the supplier. The company contacts Platus in order to set up an insurance policy covering the non-reimbursement of payments. This will permit the putting in place of a credit in favour of the buyer by the bank of the supplier which will benefit from the insurance coverage.
- The early intervention of Platus permitted its client and its bank to offer a financing solution under the best conditions thanks to an optimisation of all the financial costs, the insurance coverage price having been identified with respect to the financing price.
- Upon the request by the buyer for a repayment deferral, Platus intervened and renegotiated the conditions for the insurance coverage extension.