An export credit insurance is necessary when the exporter
A)is exposed to the risk that the importer may default on payment.
B)is dealing in a country that has a nonconvertible currency.
C)is unable to obtain any pre-export financing.
D)has received a letter of credit from the importer's bank.
E)has to enter a barterlike agreement.

Question

Quizplus · Accepted Answer

An export credit insurance is necessary when the exporter is exposed to the risk that the importer may default on payment. The insurance protects the exporter against the risk of non-payment or late-payment by the importer due to commercial or political reasons. It helps the exporter to mitigate the risk and focus on expanding their international trade.

An Export Credit Insurance Is Necessary When the Exporter