Q. I supply services, rather than goods. Can I get credit insurance?
A. Yes, coverage is available for goods delivered or services provided. As long as the sale is business to business on terms or credit it can be covered.
Q. I sell to US local authorities. Do I have to include those Sales?
A. No. Providing you are supplying a US government buyer directly there is deemed to be no risk. You only pay for “insurable Sales”.
Q. What is insurable Sales?
A. Credit sales turnover to a business covered fully or in part under the policy by an underwriter written limit or as part of the Discretionary limit cover.
Q. Can the underwriter withdraw cover during the life of the policy?
A. Depends on the type of policy you have. Insurance companies spend a significant amount on monitoring and if significant negative information is received they may decline to cover future deliveries but the goods or services already provided are covered. Your credit management will be significantly enhanced leading to fewer bad debts in future.
Q. What happens if I am obliged to deliver and the underwriter withdraws a credit limit?
A. Most credit insurance policies have a clause allowing a 30 day grace period so that trade can continue while further information allowing an evaluation of the negative information can be sought. If your contract of sale is legally binding such cover can be added.
Q. What does credit insurance cover?
A. Non payment by a business of a trade debt due to insolvency, inability or they simply didn't pay. You will not have to increase your sales dramatically to cover the cost of the loss.
Q. Do I have to cover all my customers?
A. No, We always exclude sales of COD, sales of CBD, in house sales, and can even exclude customers that we don't feel pose a risk. However, usually the most cost effective policies in the market are “whole turnover” but we will work with you to find the best policy option for your needs. You will have the best cover for the lowest price.
Q. Will the underwriter set cover on all my customers?
A. It depends on each industry. Most policies have a “Discretionary Limit” where underwriters delegate the smaller limits back to the policyholder. A policyholder can maximise cover by using trading history and other means to justify insured credit limits.
Q. How much will it cost?
A. Minimum Premiums are set for a 12 month period and usually come in at about a small fraction of 1% of Gross Sales or the insurable sales.
Q. If i can't get regular coverage on a customer is there a way to still get coverage?
A. Absolutely, There almost always is a way to get coverage even on high risk customers. You should not have to turn down business due to the uncertainty if you will be paid by the customer.