How far Your Credit Sales Receivables Are Protected?

The sales of goods and services are exposed to a significant number of risks, many of which are not within the control of the supplier. The highest of these risks and one that can have a catastrophic impact on the viability of a supplier, is the failure of a buyer to pay for the goods or services it has purchased.

In today’s challenged domestic and global economic climate, recognizing and managing future risks has become a priority for businesses. Losses attributed to non-payment of a trade debt or bankruptcy can and do occur regularly. Default rates vary by industry and country from year-to-year, and no industry or company is immune from trade credit risk.

What is Credit Insurance?

Trade Credit insurance provides a business with protection against the failure of a customer to pay their trade credit debts. This can arise as a result of a customer becoming insolvent or because your customer fails to pay within the agreed credit period. These risks are referred to as 'commercial risks'.

Trade credit insurance can also include a component of Political Risk insurance, which is offered by the same insurers to insure the risk of non-payment by foreign buyers due to the actions or inactions of the buyer’s government.

Both Domestic and International Trade can be covered.

Trade credit insurance insures the payment risk of companies, not of private individuals.

Policy holders require a credit limit on each of their buyers in order for the sales to that buyer to be insured.

There will be a minimum premium is applicable when the Credit Sales Turnover is less than $25Mn.

Why Should you Consider Using Credit Insurance?

Research suggests that 18% of companies that fail do so because they have experienced bad debt or poor working capital.

Businesses protect your tangible assets such as property and plant, but often neglect to cover your receivables which can represent 40% of their current assets.

Credit insurance can reduce the unnecessary cost of bad debt and protect hard-earned success, and provide the cornerstone of secure growth.

How Much Cover Is Available?

On average, the level of indemnity is 85% on your Credit Sales Insurance Turnover but this can vary, depending on the type of policy you choose or on your specific requirements.

Additional Benefits

  • A reduction in bad debt provisions, thereby releasing tied up capital.
  • Better risk prevention through the 'early warning' system provided by the credit limits service.
  • Greater access to finance. A credit insurance policy can be used to provide security to a lender for trade or export finance.
  • Better sales targeting - It helps to target new customers and markets as well as monitoring existing customers.
  • Representation at meetings of creditors and free legal and practical advice on enforcing Retention of Title rights

Our Role

Gargash team would be happy to visit your office to brief you about the policy & how it works. To take it forward, Gargash will assist you from filling the proposal form and will negotiate with the insurers to obtain the competitive terms for you. Gargash will arrange a mutual meeting with the insurer before placing the policy to clarify all your other queries and will support you in handling the claims.

CII ACCREDITATION

We're proud to have been awarded the prestigious title 'Chartered Insurance Brokers' by the Chartered Insurance Institute (CII). The award of Chartered titles is strictly controlled and is an objective measure of high standards of professionalism...

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