The Insurance Regulatory Development Authority of India on 7th April 2021 has issued draft guidelines on Trade Credit Insurance to enable general insurers to offer trade insurance covers to financial institutions which will help companies manage their risks overseas, manage non-payment risks associated with trade financing portfolio and open up access to new markets..
The new guidelines will open up opportunities to offer credit insurance-backed financing solutions to corporates and MSMEs. Also, changes such as enhanced indemnity of 90% and pre-shipment risk coverage will make the credit insurance product more comprehensive.
IRDAI proposed the guidelines to set out the regulatory framework to promote sustainable and healthy development of trade credit insurance business and has it has been decided by the Authority to place these draft guidelines for seeking their valuable comments and inputs.
The interested parties shall submit their views and comments on the draft guidelines which shall be addressed to nl-products@irdai.gov.in and .naulak@irdai.gov.in by 28th April 2021.
