Income from insurance premium may cross Rs850 cr: ECGC

Income from insurance premium may cross Rs850 cr: ECGC

New Delhi: State-run Export Credit Guarantee Corporation of India (ECGC) on Tuesday said that its income from insurance premium is expected to jump by over Rs100 crore this fiscal to Rs850 crore, as more and more exporters are facing payment defaults.

“I am confident we will cross Rs850 crore (in 2009-10)," ECGC chairman and managing director A.V. Muralidharan said.

In 2009, ECGC’s income from premium was Rs745 crore.

ECGC provides a range of credit risk insurance covers to exporters against loss in export of goods and services. It also gives guarantees to banks and financial institutions to enable exporters to obtain better facilities from them.

Exporters have been complaining of payment defaults as buyers in the western markets have been impacted due to the demand slowdown.

The corporation had sold about 14,500 policies in 2008-09 and is expecting a 5% increase in sales this fiscal.

Muralidharan said that the US buyers accounted for the bulk of total default claims.

“Highest defaults claims are coming from the US, about 25% of the overall claims are from the US," he said.

He said that ECGC had paid Rs451 crore towards claims in 2008-09 and as per the latest figures it has disbursed Rs146 crore in the current fiscal.

Providing relief to exporters, the government had extended the insurance cover up to March 2010.