SINOSURE Main Terms Every Importer Should Know

Sinosure, which stands for China Export & Credit Insurance Corporation, is a state-owned enterprise in China specializing in export credit insurance. Its primary goal is to protect Chinese companies against risks linked to exporting goods and services internationally. These risks include non-payment by foreign buyers, political instability, and commercial disputes.

Orders insured by Sinosure enable global importers to negotiate deferred payment terms with Chinese suppliers. Therefore, if you engage with factories in China and seek Sinosure coverage for your orders, it's essential to familiarize yourself with specific terms to ensure seamless communication with your Chinese partners.

Export credit insurance is a type of insurance policy designed to protect exporters against the risk of non-payment by foreign buyers. It covers the exporter's accounts receivable, ensuring that they receive payment for goods or services delivered to buyers abroad.

As a Chinese enterprise, Sinosure specializes in providing export credit insurance for Chinese companies engaged in international trade. If the foreign buyer is unable to pay or goes bankrupt, Sinosure steps in to cover the losses incurred by the Chinese company.

The term "Sinosure policy" commonly refers to export credit insurance policies offered by Sinosure specifically for Chinese exporters. This policy establishes a contractual agreement between the exporter and Sinosure, detailing the terms and conditions of the insurance coverage provided. It outlines the extent of coverage, including the insured amount, premium rates, and other relevant provisions.

Sinosure credit limit refers to the maximum amount of credit that Sinosure is willing to insure for a particular importer. This limit is determined based on several factors, including the importer's creditworthiness, payment history, industry reputation, country risk, and other relevant information. Once Sinosure determines the credit limit for the importer, it provides insurance coverage for their orders up to that specified amount.

Similar to how individuals have credit scores to assess their creditworthiness, Sinosure evaluates and assigns credit ratings to companies that import goods from China. These ratings indicate the level of risk associated with insuring transactions involving that company. A higher credit rating signifies a lower risk, making it easier for the company to secure a higher Sinosure credit limit and negotiate favorable deferred payment terms with Chinese suppliers.

SinoRating is a specialized credit rating department affiliated with Sinosure. It is responsible for evaluating the creditworthiness of companies that import goods from China and apply for a Sinosure credit limit. SinoRating assesses various factors, including financial stability, payment history, and industry performance, to assign ratings. These ratings assist Sinosure underwriters in making informed decisions about providing credit limits and insurance coverage for specific importers' orders.

Before Sinosure agrees to insure a deal, they assess the risk involved. They look at things like the financial stability of the buyer, the political situation in the buyer's country, and other factors that could affect the deal. Typically, Sinosure provides export credit insurance to mitigate both commercial and political risks associated with international trade deals.

Similar to other insurance or financial services, Sinosure charges premiums and fees for their services. These premiums are payments made by Chinese companies to Sinosure in exchange for coverage for their exports.

In the event that a deal encounters difficulties and the buyer is unable to fulfill payment, the Chinese company can initiate a claims process with Sinosure. This process involves providing evidence of the financial loss and working with Sinosure to seek compensation. Sinosure will then review the claim, and upon verification, will proceed to pay the Chinese company the money they're owed.