Arbitration - A process to settle a legal dispute in which the third party (the arbitrator) acts much like a judge, but in an out-of-court and less formal setting and does not actively participate in the discussions.
Berne Union - The international association of insurers of export credits and investments was established in 1934. The official name of this association is The Berne Union – International Union of Credit and Investment Insurers.
Breach of contract - Loss resulting from government termination of contracts without compensation for existing investments in a product or service.
Broker - An intermediary who represents the insured in its dealings with an insurer and/or shops for coverage on behalf of the insured. Also, organizations that sell Lloyd’s policies to insureds.
Buyer’s Credit - A special purpose loan agreement or a loan agreement for financing an Export Contract between a bank or a company as a lender or credit as one party and a foreign bank or other legal entity guaranteed by the bank or by a Public law entity as a borrower or a debtor as the other party, under which the Foreign debtor’s primary liability relates to the payment of interest and repayment of the princiapl debt to the lender or creditor.
Cancellation - Termination of an insurance policy by the insurer or the insured prior to the policy’s scheduled expiration date.
Civil strife damage - Property or income losses from domestic political violence, including hostile actions by national forces, civil war, revolution, insurrection, or politically motivated terrorism or sabotage.
Coinsurance - Insurance held jointly by two or more insurance providers.
Creeping expropriation - A series of events by a government (or a subsovereign entity) that results in a deprivation of the investor’s rights.
Deductible - The up-front amount of a loss for which the insured is responsible before benefits are paid; also known as a self-insured retention. The insurer’s liability begins when or if the deductible is exhausted.
Denial of Justice - A type of political risk implying the measures of the host country by which the insured party is denied or unable to access a judicial or arbitrate forum or is unable to obtain enforcement of a reached court decision.
Export Contract - A contract between a Uzbek company or a crafts business as one party and a foreign legal or natural person as the other party, under which the Uzbek party’s liability relates predominantly to producing and/or delivering goods and/or rendering services to a foreign buyer.
Export Credit Agency - Common name for insurers implementing their national schemes of export credit insurance against political and commercial risks for and on behalf of the state.
Expropriation - An action whereby a government seizes property of assets of the foreign investor without full compensation to the investor. This is also referred to as ‘ownership risk’ or nationalization.
Foreign Buyer - A foreign natural or legal person importing Uzbek goods and/or services under the Export Contract.
Foreign Debtor - A foreign natural or legal person from which the Exporter or Exporter’s bank requests a certain cash equivalent on the basis of performed deliveries of goods and services under the Export Contract, i.e. the Loan Agreement. In case of insurance of direct deliveries of goods and services, the debtor is usually a buyer to whom the Croatian exporter delivered his goods or rendered his services, whereas in case of insurance of credit to a foreign buyer or his bank, the foreign debtor can be the foreign buyer and/or his bank or any other guarantor under the Loan Agreement.
General Terms and Conditions of Insurance - Written document on rights and obligations of the insured party and the insurer regarding the export credit insurance against political and/or commercial risks.
Guarantee - A promise, especially in writing, that something is of specified quality, content, benefit, or that it will provide satisfaction or will perform or produce in a specified manner. In the thrift industry, one such guarantee is the promise of the insurer of mortgage-backed securities that the issuer will pay principal and interest to investors in those securities, even if borrowers of the underlying mortgage loans default.
Guarantor - An entity that promises to pay an obligation in the event the obligor fails to do so.
Host Country - A country into which the Uzbek investor invests a certain amount of funds, either in assets, rights or cash.
Inconvertibility - An action taken by a government to prevent conversion of local currency to some form of foreign exchange. This is also referred to as ‘transfer risk’.
Indemnity - Cash amount which is paid by the insurer to the insured party for the purpose of indemnity of the loss arising from the fulfilment of an insured risk.
Insolvency - The inability to pay one’s debt as they come due. Even though the total assets of an organisation may exceed its total liabilities, the entity is insolvent if the assets cannot be converted into cash to meet the current obligations.
Insurance Contract - Legal transaction by which the Insured party is obliged to pay the insurance premium, and the Insurer takes over the obligation of indemnity payment in case of occurrence of the insured case to the Insured party or a third person to which the Insurance contract has been assigned. The Insurance policy and the accompanying General Terms and Conditions represent the complete text of the insurance contract.
Insured - A purchaser of insurance; one who enjoys protection under an insurance policy; also known as a policyholder.
Insurance Policy - A written document on the concluded Insurance contract issued by the Insurer.
Insurance Premium - Cash amount paid to the Insurer by the insured party on the basis of a concluded insurance contract.
Insured Risk - Future uncertain event which occurs independently from the exclusive will of the insured party due to which the insured party may suffer a loss.
Insurer - A legal person that issues an insurance policy.
Investment Agreement - An Agreement concluded between the Insured party and the host country defining the obligations of the parties relating to an investment abroad.
Letter of Credit - A document issued by a financial institution on behalf of a buyer stating the amount of credit the buyer has available, and that the institution will honour drafts up to that amount written by the buyer. It gives the buyer the prestige and financial backing of the issuing institution and satisfies the requirements of the seller in completing the transaction. The accepting institution has a prior agreement as to how the buyer will pay for the drafts as they are present.
Limit of Liability - An insurer’s aggregate liability for policies in force as of a given date.
Loan Agreement - Agreement to be executed by borrowers, containing pertinent terms, conditions, covenants and restrictions.
Local Costs - Expenses for the goods or services in the buyer’s country that are necessary for honouring the export contract. Local costs do not include commissions paid to the exporter’s agent in the importing country.
Loss - Loss expressed in cash equivalent that occurred for the insured party as a result of the occurrence of any of the insured risks.
Loss during the Production - A special form of insurance which is approved for goods ordered by a special order for a certain buyer. The risk occurs when the foreign buyer unilaterally terminates the Export contract before the goods have been delivered. In this case, the insured amount ranges in the amount of actual production costs.
Mediation - A process to settle a legal dispute through active participation of a third party (the mediator), who works to find points of agreement and make those in conflict agree on a fair result.
Obligor – A debtor.
Policy period - The period during which an insurance policy provides coverage.
Political risk - Political risks are associated with government actions which deny or restrict the right of an investor/owner (i) to use or benefit from his/her assets; or (ii) which reduce the value of the firm. Political risks include war, revolutions, government seizure of property and actions to restrict the movement of profits or other revenues from within a country.
Political risk management - Actions taken by investors to manage political risk, such as incorporating political risk into the company’s financial equation, obtaining information from diverse sources and applying portfolio theory to international investments.
Political violence damage - Property or income losses arising from violence undertaken for political purposes, such as declared or undeclared war, hostile actions by national or international forces, civil war, revolution, insurrection and civil strife (See Civil strife damage).
Prague Club - The Prague Club was developed in the early 90-ties on the initiative of the then Secretary General of the Berne Union in order to establish the cooperation and to hold regular meetings of newly established and already existing export credit agencies from Eastern and Central Europe.
Project Enterprise - Company in a host country which is the subject matter of investment or any person acting in the name of this company.
Public Law Entity - A legal person representing sovereign authority, which cannot be subject to a bankruptcy procedure by a court or an administrative decision.
Reimbursement of Costs - Should the Insurer not be obliged to pay the indemnity, because the claim has been completely paid by the Foreign buyer, the costs caused by such payment can be reimbursed in the percentage of insurance defined by the General Terms and Conditions. Usual costs incurred during the export transaction in the business operation of the Insured party, its agent or partner, will not be reimbursed.
Reinsurance - The process of a political risk insurance provider issuing a guarantee with other providers in order to reduce exposure by spreading the risk among the institutions involved.
Retention - Own share of the insured party in the loss under the export contract.
Starting Point of Loan Repayment - Date on which the loan starts to be repaid, which in case of the official export credit agencies is defined pursuant to the international rules.
Subrogation - The process by which an insurer, after payment of a claim, is able to substitute itself for the insured and assert the rights of an insured against a third party.
Tenor - The term of a political risk insurance contract.
Transfer Restriction or Impractibility - A type of political risk which implies any measure of the host country that prevents the insured party from, directly or indirectly, converting dividends, profits or other monetary benefits or proceeds from the disposal of the insured investment from the local currency into the insured currency.
Waiting Period - The period from the maturity date of the insured receivable until the date when the Insured party has the right to submit a Claim. The waiting period is stipulated in the Insurance policy. The usual waiting period in case of a prolonged non-payment is 6 months, whereas in case of a bankruptcy, the Claim can be submitted immediately upon entering into bankruptcy estate property.
War and Civil Disturbances - A type of political risk which implies the event/events in the host country having the characteristics of declared or undeclared war, civil disturbances, revolution, terrorism or sabotage with the aim of achieving political objectives, and causing permanent damage, destruction or liquidation of property of the project enterprise or non-payment of the loan instalments due because of such an event.
Warranty - A statement, either written, expressed or implied, providing assurance that some specified provision in a contract, such as a sale, is true.
Copyright © 2019 Uzbekinvest National Export-Import Insurance Company. Uzbekinvest International Insurance Company Limited is registered in England: company number 2997845. Registered address: The AIG Building, 58 Fenchurch Street, London EC3M 4AB. Uzbekinvest International Insurance Company Limited is authrorised by the Prudential Authority and regulated by the Financial Authority and Prudential Regulation Authority (FRN number 202923). This information can be checked by visiting the FS Register (www.fca.org.uk/register).