Belarus’ insurance cos given access to export financial risk insurance – expert
MINSK, Jul 16 - PrimePress. Belarusian insurance companies have new opportunities for diversifying service portfolios aimed at increasing exports, as per amendments to presidential decree No.534 of August 25, 2006, says Alexander Timoshishin, Deputy Director General of Beleximgarant State Insurance Company.<br> <br> With a view to assist Belarusian producers in entering foreign markets, presidential decree No.39 of February 4, 2021 amended several acts, including decree No.534 that regulates export insurance and export crediting.<br> <br> “Access is given to the insurance organizations with over Br25 million ($9.83 million at the exchange rate of the National Bank of Belarus) in equity capital. With this amount in place, the insurer is entitled to insure export risks under decree No.534, but without state support. Today, our capital is around Br495 million ($194.56 million). The company is second in the market in terms of the capital size,” Timoshishin says.<br> <br> Also, decree No.534 introduces exporters’ public liability insurance under export contracts. <br> <br> “When a company enters into a contract, and the contractor requests a guarantee for advance refund or discharge of contract, an appropriate guarantee is required (internationally common a bank or insurance guarantee). No insurance guarantee had been provided in Belarus until now. The new tool introduces a new line of insurance services: insurance of liability to the counterparty under contracts with Belarusian exporters,” says Timoshishin.<br> <br> Decree No.39 introduces the institution of the so-called “beneficiary party.” Previously, business risks insurance only covered risks of the insurant. If a company signed an insurance contract against its financial risks, this very company would be the loss payee. Now, the exporting company that insures its export risks under decree No.534 may indicate in the insurance contract the beneficiary in whose favor the insurer will pay the insurance indemnity.<br> <br> “Importantly, it is proposed to keep export risk insurance with state support and introduce export risk insurance without such support. For example, Beleximgarant provides insurance of export risks with state support. The point is that if we are unable to pay insurance indemnity for financial reasons, we have the right to apply to the state for a budgetary subsidy, which is specified annually in the national budget. Other insurers only rely on their own capital and reserves. Decree No.39 gives other insurers the right to insure export risks, but without state support,” says Timoshishin.<br> <br> Expected amendments to decree No.39 provide for portfolio diversification in terms of risks with the application of new instruments, new projects on new markets, particularly in the Middle East and Africa, and increased export financing under decree No.534. <br> <br> Beleximgarant was established in 2001. The company is a state export credit agency also extensively engaged in other types of insurance. End (Br2.5442/$1)<br> <br>
2021-07-17
Primepress
Belarus’ insurance cos given access to export financial risk insurance – expert
With a view to assist Belarusian producers in entering foreign markets, presidential decree No.39 of February 4, 2021 amended several acts, including decree No.534 that regulates export insurance and export crediting.
“Access is given to the insurance organizations with over Br25 million ($9.83 million at the exchange rate of the National Bank of Belarus) in equity capital. With this amount in place, the insurer is entitled to insure export risks under decree No.534, but without state support. Today, our capital is around Br495 million ($194.56 million). The company is second in the market in terms of the capital size,” Timoshishin says.
Also, decree No.534 introduces exporters’ public liability insurance under export contracts.
“When a company enters into a contract, and the contractor requests a guarantee for advance refund or discharge of contract, an appropriate guarantee is required (internationally common a bank or insurance guarantee). No insurance guarantee had been provided in Belarus until now. The new tool introduces a new line of insurance services: insurance of liability to the counterparty under contracts with Belarusian exporters,” says Timoshishin.
Decree No.39 introduces the institution of the so-called “beneficiary party.” Previously, business risks insurance only covered risks of the insurant. If a company signed an insurance contract against its financial risks, this very company would be the loss payee. Now, the exporting company that insures its export risks under decree No.534 may indicate in the insurance contract the beneficiary in whose favor the insurer will pay the insurance indemnity.
“Importantly, it is proposed to keep export risk insurance with state support and introduce export risk insurance without such support. For example, Beleximgarant provides insurance of export risks with state support. The point is that if we are unable to pay insurance indemnity for financial reasons, we have the right to apply to the state for a budgetary subsidy, which is specified annually in the national budget. Other insurers only rely on their own capital and reserves. Decree No.39 gives other insurers the right to insure export risks, but without state support,” says Timoshishin.
Expected amendments to decree No.39 provide for portfolio diversification in terms of risks with the application of new instruments, new projects on new markets, particularly in the Middle East and Africa, and increased export financing under decree No.534.
Beleximgarant was established in 2001. The company is a state export credit agency also extensively engaged in other types of insurance. End (Br2.5442/$1)