Jeonbuk Province Supports Export Insurance Premiums for Small and Medium Enterprises

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] Jeonbuk Province announced on the 18th that it will spend 230 million KRW this year to support export insurance premiums for small and medium-sized enterprises (SMEs) in cooperation with the Jeonbuk branch of the Korea Trade Insurance Corporation.

Jeonbuk Province supports SMEs in subscribing to export insurance to prepare for risks such as failure to collect export transaction payments overseas or delayed payments by importers that could affect company operations. Each company can receive support for export insurance premiums up to 3 million KRW.

The supported export insurance premiums can be used for export credit guarantees, short-term export insurance, foreign exchange fluctuation insurance, and importer credit investigation services.

Export credit guarantee (before shipment) is a system where the corporation guarantees loans from financial institutions necessary for purchasing raw materials and production for export. The province supports the related guarantee fee (50% of the guarantee fee, up to 1.5 million KRW).

Short-term export insurance (Smallplus+ insurance) pays the company 100% of the loss amount within the liability limit in case of loss caused by risks selected by the insured, such as importer risk, letter of credit risk, and importing country risk.

Short-term export insurance (group insurance) is an insurance where local governments or organizations are the policyholders and SMEs are insured as a group. Companies can receive insurance payments up to 95% of losses within a limit of 50,000 USD in case of non-collection risk of export payments.

Foreign exchange fluctuation insurance eliminates the risk of exchange rate fluctuations that may occur between the export contract date and the export payment collection date. It can be used within the limit granted based on export performance.

Importer credit investigation service is a service that investigates the financial status and business performance of importers and can be used when detailed information about the counterpart importer is needed during export transactions.

The target for export insurance premium support is SMEs with headquarters or factories (business sites) in Jeonbuk Province and annual sales under 100 billion KRW last year. Applications can be made through the Jeonbuk branch of the Korea Trade Insurance Corporation.