The small exporter’s policy is the standard policy. It incorporates certain improvement regarding cover, to encourage small exporters to obtain and operate the policy, The main features of small exporter’s policy are listed below point-wise:
- The policy is issued to exporters whose anticipated export turnover for the next 12 months does not exceed Rs.50 lakhs.
- The policy is issued for 12 months.
- Shipments need to be declared twice only. For the first six months, shipment is reported in the seventh month, and for the last six months, shipment is reported in the 13th months.
- The exporters need to submit monthly declarations of all payments remaining overdue by more than 60 days from the due date.
- ECGC (Export Credit Guarantee Corporation) will pay claims to the extent of 95% where the loss is due to financial risks and 100% if the loss is caused by any of the political risks.
- The waiting period for making claims is two months.
- To deal with the buyers, exporters have been permitted without prior approval of ECGC to change terms of payment or extension in credit period. For example, a DP (Documents against Payments) Bill may be converted into a DA (Documents against Acceptance) bill.
- In the case of resale of unaccepted goods, the exporter is permitted to sell goods to an alternate buyer without obtaining prior approval of ECGC, for which ECGC may consider payment of claims considered reasonable by it.
- ECGC may consider payment of a reasonable claim where the loss is due to loss or damage of goods due to certain risks not typically included in general/marine insurance policies.