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Factoring Insurance Policy

Dhaman provides factoring companies with a comprehensive insurance solution that covers the risks of default of payment of the obligors. The factoring insurance service offered by Dhaman enable factoring companies to:

 

  • Avoid admission of risky operations.
  • Expand business through acceptance of larger transactions.
  • Increase volume of transactions without recourse.
  • Obtain a compensation up to 90% of the value of the insured invoices on both domestic and export transaction.

 

Covered Risks

  • Commercial risks:
    – Bankruptcy of the obligor
    – Protracted default of the obligor

  • Political risks:
    – Transfer restrictions
    – War and civil disturbances
    – Confiscation, Expropriation and Nationalization
    – Public and governmental Entities default of payment

 
Remark,
Only commercial risks are covered for the domestic factoring transactions.
 

Eligibility criteria

  • Insured factoring company must be of Arab nationality or joint Arab – Foreign nationality.
  • Insured goods/ services must be Arab origin. Strategic goods/equipment of non- Arab origin are eligible for the insurance.
  • Absence of ownership or Joint management relationship between the insured factor & the obligor.

 

Factoring Insurance application form (PDF)