Export Credit Insurance – Hermes Cover

Why is cover needed for exports to unstable markets?

The creditor risks that arise in export transactions can be considerable, particularly for exports to politically unstable or economically weak countries: alongside the usual transfer-stoppage risk, a country-specific political risk may additionally arise here. Where these risks are not adequately covered, otherwise lucrative business abroad is sometimes foregone altogether, out of concern over an incalculable risk of non-payment — which can, in turn, hold back export-driven growth. Export-oriented states therefore have a particular interest in deploying suitable export-promotion instruments that protect domestic exporters as far as possible against export credit risks and preserve the competitiveness of the domestic export industry. Both private and state credit insurance are used in practice for this purpose.

What are the limits of private-sector credit insurance?

Private-sector credit insurance generally offers less protection than state schemes. In particular, cover for economic risks on export transactions to economically unstable countries is regularly refused, or accepted only under narrow conditions, while cover for political country risk in politically unstable countries is frequently excluded from the outset.

What is meant by “Hermes cover”, and how does it work in Germany?

Note: this section on the German scheme has been kept deliberately brief and is included only for comparison; the practical focus for Greek exporters is the final section below. In Germany, the colloquial term for the state’s export credit guarantees is “Hermesdeckungen” (Hermes cover), administered on the Federal Government’s behalf by Euler Hermes Aktiengesellschaft (part of the Allianz Trade group since 2021) together with PwC. Cover is granted either as an export bond (Hermesbürgschaft), where the foreign buyer is a sovereign or public-law entity, or as an export guarantee (Hermesgarantie), where the buyer is a private party — the latter also covering the buyer’s insolvency risk. A range of standard products exists for different transaction types and terms, including whole-turnover and single-transaction cover, supplier and buyer credit cover, manufacturing-risk cover, and cover for construction, leasing, and project-finance transactions, addressing both political risks (such as war, transfer restrictions, or expropriation) and economic risks (such as non-payment or insolvency). Fees follow the OECD Consensus framework agreed by the export credit agencies (ECAs) of OECD member states and depend on the buyer country’s risk category and the term of cover; current guidelines and rates can be accessed via the AGA portal (aga-portal.de).

Is there a comparable instrument for Greek exporters?

Yes. Germany’s “Hermes cover” is a purely German support instrument and is not directly available to Greek exporters. In Greece, the equivalent function is performed by the Οργανισμός Ασφάλισης Εξαγωγικών Πιστώσεων (ΟΑΕΠ), which, following a 2022 reorganisation, also operates under the name Export Credit Greece (ECG) and is organisationally part of the Hellenic Development Bank group. ΟΑΕΠ/ECG likewise offers Greek exporters — in coordination with the Greek Ministry of Foreign Affairs and the Ministry of Development — state-backed cover for short-, medium-, and long-term export receivables against commercial and political risks, including instruments for pre-financing export transactions (e.g. “Εξωστρέφεια”). A Greek company that exports should approach ΟΑΕΠ/ECG directly for these purposes, rather than the German Euler Hermes AG or Allianz Trade. Exporters based in other countries should likewise check whether their own state maintains a comparable export credit agency, since most OECD member states do.