Benefits of Credit Insurance
- Allows you to trade in the knowledge that if you don't get paid then there is
someone to help protect your cash flow.
- Allows you to evaluate the risk of taking on new contracts and continually monitors these risks for future problems.
- Allows you to sell more to existing companies by identifying the good risks.
- Can be used as security against lending facilities which may in turn allow you to negotiate a better borrowing rate
or extend your current agreement
- Helps improve cash flow.
- Usually more cost effective and simpler than raising Letters of Credit
- Credit insurance provides a definable cost on which you can budget and irons out the peaks where you have bad debts
as opposed to the bad debt coming straight off your bottom line.
- Companies that credit insure have less bad debts than those that don't.
- To recuperate a bad debt of £10,000 you will need to make at least another £100,000 in additional sales
where your margins are 10%
- Protects your profit, your balance sheet and your companies future.
- Ability to access a range of credit management services, e.g. some insurers offer free credit opinions and a free
debt collection service.
- Allows you to reduce your bad debt provision, thus releasing tied up capital.
And the reason most take it out - Allows you to sleep at night. - Back to the Credit Insurance Home Page - if this page was of interest try clicking on
Examples of areas of where we have helped recently
-We helped a company with high concentration levels (large T/o but only a few accounts) to obtain finance by finding a provider who would underwrite a particularly difficult risk.
-We placed a multi-million pound business with an insurer who can underwrite sole traders and partnerships with ease, despite the fact that he cannot get information via the status agency market.
-A company who is factoring was struggling to get funds because of the restrictive credit limits placed on his buyers by the factor. A credit insurance policy has helped increase his borrowing ability by 20 fold.
-We helped structure a transport companies business with an insurer covering only (and paying for only) the mid to top spectrum of his accounts, he thought that wholeturnover was the only option, because this is all he has ever been presented with.
-A policyholder had a very high aggregate deductible of £50,000 attaching to the policy, we were able to restructure the policy with a threshold of £15,000 and reduce the premiums by nearly half.
-The terms on the policy stated open account 30 days there had been a misinterpretation of 30 days, the actual policyholders terms were 30 days but from month end, so in total 60 days, had a claim been made under the policy, it is questionable whether it would have been paid by the insurer, so we were able to amend the policy to reflect the correct terms.
-The policyholder could not get cover for 3 of his key buyers from his current insurer, we were able to get these accounts covered in full by another insurer with the bonus of a small premium saving.
-We have helped a company reduce their annual premiums despite an increase in turnover.
-We helped a Turkish company obtain specific account cover on one of his buyers he is supplying in the UK.
-We managed to place a company with an insurer who would underwrite twice as much cover (£2.5m) as the rest of the market.
-A supplier had orders from one company but were delivering to another company, they had a credit limit, but on the wrong company, if they had had to make a claim they would not have been paid, following our appointment we were able to highlight this and resolve the situation.
And as brokers, there are the daily benefits that we bring, negotiating credit limits, claims handling, training, etc. A broker is for the life of the policy not just for renewal.
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