Letter of credit confirmation insurance

Letter of credit confirmation insurance allows banks to confirm letters of credit from foreign financial institutions, the risks of which they would not have accepted without such insurance.

Under letter of credit confirmation insurance, SERV waives coverage intervention rights vis-à-vis the confirming bank due to elevated risk during the term of the letter of credit.

Letter of credit confirmation insurance may also be issued in combination with pre-shipment risk cover.

Insured risks:

Cover is provided against non-payment due to

• political risks
• transfer risks
• force majeure risks
• del credere risks (credit risks) such as the insolvency of banks issuing letters of credit or improper non-payment of debt from letters of credit

The maximum cover ratio is 95%.