ECGC conducts a comprehensive review of the countries covered by them, based on an internal country risk methodology that has been put in place. This methodology aims at evaluating the country not only on the prevalent economic and political settings, but also on the correct developments that would have an impact on the future, with an increase in horizon of 12 months, as well as forecast based on the strength and weakness of the country in terms of its economic and political strength.
Broad Categories
Countries in Open Cover
Cover with No Restrictions
Cover is offered usually on normal terms and conditions i.e. 90% cover, 4 months waiting period for ascertainment of loss and settlement of claims, etc.
Countries in Restricted Cover
Usually those countries where the political and/or economic conditions are relatively deteriorating or have deteriorated and likelihood of payment delays or non-payment are imminent or have occurred
Permits selection of risks ECGC wishes to underwrite
Divided into 2 Categories
Category 1: Countries for which revolving limits are approved normally valid for one year
Category 2: Countries where Specific Approval will be given on case to case basis on merits
The ECGC Risk categorisation with its equivalent symbols is given in below table.
ECGC CLASSIFICATION
RISK PERCEPTION
A1
Insignificant Risk
A2
Low Risk
B1
Moderately Low Risk
B2
Moderate Risk
C1
Moderately High Risk
C2
High Risk
D
Very High Risk
For further information may get in touch with ECGC: www.ecgc.in