Trade Credit Insurance
Trade credit insurance reimburses your company for delayed and/or uncollected accounts receivable both domestically and internationally. On average, roughly 5 percent of a business’s accounts receivable is written off as bad debt. This is a common loss that can be insured with a trade credit policy.
Common Issues Businesses Face:
- Bad debt write offs.
- More capital is required to expand and grow the business, but the company is unable to obtain the proper bank financing.
- The collections process is too long and has the potential to cause rifts between you and your customers.
- Your company does not have the resources to properly decide the credit limits and payment terms for your customers.
- Your company wants to expand into new markets but does not have enough market intelligence to do so.
Trade Credit Policy Benefits:
- Reimbursement for bad debt losses.
- Increases sales by extending more credit to your customers on more flexible terms.
- Increases borrowing power with the security of insured receivables.
- Covers loss due to political risk.
- Expert credit information resource if you wish to obtain credit information about your current customers as well as potential customers in new markets.
- Transfer the responsibility of the collection services to a specialized department within the insurance company.