More attractive terms and conditions for Investment Insurance
Dutch companies operate globally. This offers opportunities, but also entails risks. Atradius Dutch State Business can offer companies protection against these risks. These risks often relate to payment risks or working capital in export transactions. However, there is a solution for political risks associated with foreign investments: Investment Insurance. This product has been updated and the terms and conditions have become more attractive.
Those who invest abroad sometimes find themselves faced with a different political or legal reality. And given current geopolitical developments, stability cannot be taken for granted everywhere. For Dutch companies, protection against these kinds of risks can therefore be a decisive factor in the decision on whether or not to invest in a particular country. Atradius Dutch State Business can offer such protection on behalf of the Dutch state, including by insuring against risks such as the consequences of war and expropriation. Such situations can lead to the suspension of operations and financial loss, without any compensation being available. However, even less drastic but equally troublesome situations can cause problems for the foreign branches of Dutch companies. Many countries around the world may face a shortage of foreign hard currency. In response, capital controls are regularly introduced. For Dutch companies, this can lead to difficulties in paying dividends, loan repayments or even interest payments on loans to subsidiaries. Atradius Dutch State Business’s insurance can also provide cover for these issues.
Investment Insurance can also provide cover in the event of a breach of contract by local government bodies or state-owned enterprises. For example, a state-owned enterprise, such as a local electricity or water company, might fail to fulfil the terms of a supply contract.
For decades, investment insurance has been an unchanged part of the product range with which Atradius Dutch State Business supports Dutch companies. It was therefore necessary to review the terms and conditions under which the product is offered in the light of current circumstances. In doing so, we carefully examined the offerings of export credit insurers in neighbouring countries, all of which provide a similar product. This has led to a number of improvements.
So what has been improved?
- Cover for transfer issues has been expanded and is now better aligned with investors’ practical needs.
- In the event of a breach of contract by a state-owned enterprise or government body, failure to comply with a court judgement serves as the basis for compensation.
- The cover percentage has been increased from 90% to 95%. For green transactions, this can rise to 98%.
- Premiums have been reduced across the board.
- A 15% discount may apply to green transactions.
Are you looking to invest internationally and want to know which political risks you can cover? Then please contact Atradius Dutch State Business. We’d be happy to discuss the possibilities of the updated Investment Insurance with you.
Further information: Robert Harsanyi – Key Account Manager