We are...

Bulgarian Export Insurance Agency (BAEZ) is an insurance company offering insurance of receivables from export and transactions within Republic of Bulgaria. 

BAEZ has also developed schemes that facilitate access of the companies to credits and financing.

The Agency was founded in 1998 with share capital of BGN 10,000,500.
Since 2004 the sole shareholder in BAEZ is Republic of Bulgaria, represented at present by the Minister of Economy, Energy and Tourism.

We offer...
Insurance of credit risks and opportunities for financing

We believe...
Trade receivables are an asset that deserves protection

We know...
That the nature of risk changes all the time and that is why we offer our clients the best insurance solutions

Our activity...

Is regulated by:

• The Export Insurance Act (Activity on the state’s account);
• Insurance Code (Activity on the account of BAEZ).

BAEZ insures on its own account (under the Insurance Code):

• Payments against commercial marketable risk concerning the export towards countries, qualified as countries with marketable risk. These are the EU members and most of the OECD members;
• Payments against commercial domestic risks, that occur in Republic of Bulgaria.

BAEZ insures on the account of the State (under the Export Insurance Act) payments against non-marketable commercial and political risk, related to export to the rest of the world. Under The Export Insurance Act, BAEZ insures also Bank credits for pre-shipment and Credits and financing, granted to SMEs, as well as for the industries of primary importance for the Bulgarian economy. In these cases State guarantees the insurance indemnifications by annually allocated funds in the State Budget.

We assure...

Protection against non-payment and opportunities for development of your business
Insurance of credit risks is one of the best solutions for a company to cover the risk of non-payment of its contractors. This could prevent or limit company’s collapses as well as its liquidity problems.
Deferred payments under export contracts of goods and services are established as practice in the internal and international trade. In order to develop their competitive advantages by offering the clients more profitable conditions and prices in the business transactions, suppliers take increased risk by trading under deferred payment condition. That is why insurance of the receivables of the export or domestic trade, allows the companies to decrease the risk of their business activity, to increase their volumes and to extend their activity on the new markets.

Mechanism of Domestic and Export Credit Insurance...

We value our international partnerships...

BAEZ is a member of Credit Alliance - an international organization of the Export Credit Insurers and Credit Agencies. This membership gives us the opportunity for a global risk management and access to data-base for more than 45 million companies all over the world;

BAEZ is a member of the Prague club of the Bern Union of Export Credit Insurers;

BAEZ also cooperates with the Export Credit Agencies from many countries and has signed agreements for mutual cooperation.

Our goal is...

To give the Bulgarian companies the correct decisions for their business activity;

To be partner in the risk assessment;

To promote the extension of suppliers’ business on new markets;

To guarantee the companies’ receivables.

Improvement of the Terms of trade...

 

For our clients...

Are developed insurance products answering the suppliers requirements
BAEZ offers insurances of receivables under export Contracts of goods and services (Export credit insurance) and receivables under Contracts between companies from Bulgaria, as well. The purpose of these insurance products is to guarantee the suppliers an effective protection when delivery of goods and services is duly performed.

Export credit insurance:

• against commercial risks;
• against political risks.

Insurance of receivables over sales in Bulgaria (Domestic risk):

• against commercial risk.

The Object of the insurance coverage are payments under the contracts for sale of goods or provision of services with a credit period no longer than 2 years.

We cover...
Commercial and political risks
Commercial risks:

• Insolvency of the debtor (bankruptcy and liquidation);
• Protracted default of the debtor for a period, longer than the waiting period under the Insurance policy.

Political risks:

• Political events: war, strikes, embargo, coup, etc.;
• Moratorium on the payments;
• Confiscation and nationalization;
• Changes in the regime (scheme) of payment;
• Acceptance or changes in the legislation.

Stages of the Insurance process...

 

Insurance against short-term commercial risk (marketable and non-marketable)

The Object
of the insurance coverage are payments under the contracts for sale of goods or provision of services with a credit period no longer than 2 years.

Covered risk
is the risk of non-payment for the export of goods and services realized by the Insured, connected to the foreign buyer (insolvency and default).

Debtor is
a legal entity registered as a trader outside the territory of the Republic of Bulgaria.

Insurance indemnity
is the recovery paid by the Insurer up to the agreed in the Policy limits of the losses suffered by the Insured as a result of the occurrence of an insurance event. The insurance indemnity cannot exceed the credit limit.

The form of the insurance contract
is a framework insurance policy for the whole turnover of the Insured, excl. deliveries under advance payment and affirmed, irrevocable Letter of credit issued by Bulgarian commercial bank.

The Insurance premium
is the price of the insurance service and is defined by the Insurer depending on the risk assessment, covered risks, terms and conditions of the insurance contract.

The insurance policy
is signed under the current General terms for insurance of payments over contracts for export against short-term commercial risk (for the countries with marketable risk) and the General terms for insurance of the payments over contracts for export of services and goods against non-marketable short-term commercial risk (for those with non-marketable risk).

Insurance against short-term political risk...

The Object
of the insurance coverage are payments under export contracts of goods and services with a credit period no longer than to 2 years.

Covered risks
are the political risks, related to the country of the foreign buyer: occurrence of extraordinary circumstances in the debtor’s country or in a third country related to the payments, which prevents the settlement of the obligations regarding production and export of Bulgarian goods and services.

Debtor
is foreign country, a governmental body or a governmental organization of a foreign country that cannot be declared in bankruptcy. (The Insurance Policy is signed under the current General terms for export credit insurance against short term non-commercial risk and public buyer).

Debtor is also
a legal entity registered as a trader outside the territory of the Republic of Bulgaria. A Debtor cannot be a foreign country, a governmental body or a governmental organization of a foreign country that cannot be declared in bankruptcy. (The Insurance Policy is signed under the current General terms for insurance of payments over export contracts against short-term non-marketable risk and private buyer).

Insurance indemnity
is the recovery paid by the Insurer up to the agreed in the Policy limits of the losses suffered by the Insured as a result of the occurrence of an insurance event. The insurance indemnity cannot exceed the credit limit.

The form of the insurance contract
is a framework insurance policy for the whole turnover of the Insured, excl. deliveries under advance payment and affirmed, irrevocable Letter of credit issued by Bulgarian commercial bank.

The Insurance premium
is the price of the insurance service and is defined by the Insurer depending on the debtor’s risk assessment, covered risks, terms and conditions of the insurance contract.

 

Insurance against Domestic risk...

Covered risks
are commercial risks (insolvency and default), connected to the Bulgarian buyer.

Debtor
is an entity registered as a trader under the Commercial Law of Republic of Bulgaria that has concluded a contract for sale of goods or providing of services with the Insured and is obliged to pay under the contract.

Insurance indemnity
is the recovery paid by the Insurer up to the agreed in the Policy limits of the losses suffered by the Insured as a result of the occurrence of an insurance event. The insurance indemnity cannot exceed the credit limit.

The form of the insurance contract
is a framework insurance policy for the whole turnover of the Insured, excl. deliveries under advance payment and affirmed, irrevocable Letter of credit issued by Bulgarian commercial bank

Insurance premium
is the price of the insurance service and is defined by the Insurer depending on the debtor’s risk assessment, covered risks, terms and conditions of the insurance contract.

The Object
of the insurance coverage are payments under the contracts for sale of goods or provision of services with a credit period no longer than 2 years.
The insurance policy is signed under the current General terms for insurance of payments under contracts for sale of goods or provision of services against commercial risk, which has arisen on the territory of Republic of Bulgaria.

We also offer...

OPPORTUNITIES FOR FINANCING
BAEZ offers insurance for financing under certain schemes where Bulgarian suppliers could finance their activity currently or in advance:

• pre-shippment financing of the export activity;
• post-shippment financing under export contracts or deliveries on the territory of the Republic of Bulgaria.

The insurance policy can be concluded for the benefit of a third party, usually a commercial bank, which finances Bulgarian supplier's activity. In that case companies assure themselves higher liquidity within the credit period.

Insurance of payments with benefit for the bank...

Insurance of bank credit for pre-shipment financing...

Object of the insurance
is a bank credit for working capital for production of goods or providing services for shipment.

Insured
is the Commercial bank that provides the credit.

Covered risks include

Commercial risks:

• Default of the Debtor longer than the waiting period;
• Insolvency or Liquidation of the Debtor or opening a procedure for liquidation proclaimed with a court decision providing that the receivables of the Insured under the contract for sale of goods or provision of services are included in the list of creditors of the Debtor.

Non-commercial risks:

• Political events such as war, coup d'état, civil disturbance, riot, strike, embargo and other events with a comparable effect in the debtor's country or in a third country related to the payments under the insured export contracts of goods and services;
• Restrictions or prohibition on the shipment of goods or services imposed in accordance with international contracts to which the Republic of Bulgaria is a party, blocking the execution of insured export contracts signed before that imposition.

Debtor
is a Bulgarian trader - beneficiary of a bank loan for pre-shipment financing.

Foreign buyer
is a party under the export contract, signed with the Debtor.

Insurance indemnity
is the recovery paid by the Insurer up to the agreed in the Policy limits of the losses suffered by the Insured as a result of the occurrence of an insurance event. The insurance indemnity cannot exceed the credit limit.

The form of conclusion of the insurance contract
is a framework insurance policy for the whole turnover of the Insured, excl. deliveries under advance payment and affirmed, irrevocable Letter of credit by Bulgarian commercial bank.

Insurance premium
is the price of the insurance service and is defined by the Insurer depending on the debtor's risk assessment, covered risks, terms and conditions of the insurance contract Indemnities are guaranteed by the State.

Insurance cover
the principal of the bank credit and the interest, agreed in the Credit contract.

The Insurance Policy
is signed under the current General Terms for pre-shipment financing.

Bank credit insurance for pre-shipment financing...

Insurance of credits and financing...

Insured
is a legal entity, licensed or registered under the Credit Institutions Act of Bulgaria.

Debtor
is an entity who has concluded Credit contract with the Insured.

Credit Limit
is the maximum coverage provided by the Insurer on the principal and the agreed interest in the Credit contract.

Insurance cover
is the principal of the bank credit and the interest, agreed in the Credit contract.

Covered risks

• Default of the Debtor longer than the waiting period;
• Insolvency of the debtor in the sense of bankruptcy or liquidation of the Debtor providing that the receivables of the Insured are on the list of the Debtor’s creditors.

Indemnities are guaranteed by the State /Under the Credit Insurance Act/.

Insurance of investments...

Investment
is an asset - form of transfer of the funds to the foreign countries.

The Insured/The Investor
is any Bulgarian legal entity that invests within the territory of the accepting State.

Host country
is the territory onto which the investment to be insured.

Insurance coverage
bulgarian investments in a foreign country, capital, property, immaterial rights.

Covered risks
political and other non-commercial risks that are not related to the economic or financial performance of the foreign company. They appear under political or economical circumstances related to the host country or third country that have insurmountable force when it comes to the investment.

• Inability for conversion of the local currency to convertible;
• Inability for conversion of payments in Bulgaria;
• Expropriation, nationalization and confiscation;
• Political acts of violence mean losses of assets or losses of revenues from the foreign company resulting from war, revolution, rebellion, uprising or civil unrest, terrorism and sabotage.

The insurance policy
is signed under the current General terms for insurance of investments of Bulgarian legal entities in foreign countries against certain risk of impossibility of transfer the investment income, expropriation or politically motivated acts of violence
Insurance of bank guarantees...

Insurance coverage
bank guarantee, issued under conditions, stipulated to the Bulgarian supplier or producer (Bid bonds, Performance bonds and etc.).

Covered risks
• Equitable execution of the Bank guarantee;
• Inequitable execution of the Bank guarantee.

Insurance of letter of credit...

Insurance coverage
Letter of Credit, issued for the benefit of Bulgarian supplier.

Covered risk
the failure and/or refusal of the Issuing Bank, where the Issuing Bank has no right or cause under the terms and conditions of the Letter of Credit to honor its obligations of payment to the Insured, on the respective Due Dates.

Fees and time for response to the insurance application...

The insurance candidate pays a fee for assessment of the debtor’s  creditworthiness and granting of the credit limit. It depends on the State of the debtor.

The candidate gets discount on the fee for financial analyses for the risk assessment of more than one debtor.

The usual terms  for assessing the debtor’s risk and answer to the application are:

• 7 days for debtors, registered as traders on the territory of Republic of Bulgaria;
• From 10 to 15 days for debtors, registered traders outside the territory of Republic of Bulgaria.

Glossary...

Commercial risk
is the risk of default payment for the export of goods and services realized by the Insured.  The commercial risks are covered by BAEZ and the non–commercial risks are covered by State.

Short-term marketable risk
is the risk of non-payment under the contracts for sale of goods or provision of services with a credit period no longer than 2 years.

Non-marketable risk
is a short-term trade risk where the debtor in the shipment contract is a an entity from a State outside the States, determined as States with commercial risk which is officially announced annually.

Political risks are the risks, related to the State of the foreign buyer

• refusal to pay a due payment;
• political events such as war, coup d’état, civil disturbance, riot, strike, embargo and other events with a comparable effect in the debtor’s country or in a third country related to the payments under the insured  export contracts of goods and services;
• enactment of new or changes in existing legal Regulations, Government or another state body’s decisions in the debtor’s country or in a third country connected with the execution of payments under the insured export contracts of goods and services;
• confiscation or nationalization in the debtor’s resident country or in the country in which the debtor’s headquarters are situated, or in the country in which the payments under the export contract of goods and services must be fulfilled;
• restrictions or prohibition on the shipment of goods or services imposed in accordance with international contracts to which the Republic of Bulgaria is a party, blocking the execution of insured export contracts signed before that imposition.

Insured
is an entity that concludes insurance contract with the Insurer and has an insurance interest.  The Insured is registered as a trader under the Commercial Law of Republic of Bulgaria.

Debtor
under the Insurance contract can be a Bulgarian or a foreign legal entity, foreign state, state institution or state organization that has concluded a contract for sale of goods or providing of services with the Insured and is obliged to pay under the contract.

Credit Limit (sum insured)
is the maximum amount of Insurer’s liabilities in respect of the payments.

Period of the deferred payment (credit period)
is the time from the invoicing date until the due date.

Waiting period
is the time required to be settled the overdue payment and to make clear the matter between debtor and the insured. The beginning of the waiting period is the date of submission by the Insured of a Default Payment Declaration before the Insurer.

Creditworthiness of the buyer (debtor)
is its capability to fulfill its payment duties. BAEZ assess of the creditworthiness on the basis of legal and financial data for the buyer.

Insurance Premium
is the price of the insurance service and is defined by the Insurer depending on the debtor’s risk assessment, covered risks, terms and conditions of the insurance contract.

Insurance event
arises when a covered risk is occurred under the Insurance policy. The date of the insurance event is the date of expiration of the waiting period in case of default of the debtor or receivables of the Insured are included in the List of creditors in case of insolvency of the Debtor.

Insurance Indemnity
is the recovery paid by the Insurer up to the agreed in the Policy limits of the losses suffered by the Insured as a result of the occurrence of an insurance event.