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Credit Insurance
Credit insurance or trade credit insurance is designed to protect one your companys largest assets; trade debtors.
If your customers fail to pay due to insolvency, protracted payment, or an adverse political event, your cash flow will not suffer. We can arrange all policy types including:
- Whole turnover
- Key accounts
- Single risk
- Domestic, export, and political risks
The Alan Boswell Group Difference
The highly experienced credit team brings value by understanding the diversity of options available from today’s credit market whilst recognising that your business is unique. We understand that you will need cover correctly tailored to meet your individual needs.
How our customers rate us
Since partnering with Alan Boswell Group over 10 years ago, we have received excellent account management with a proactive approach using intuitive knowledge of our business.
Credit Insurance in detail
Credit insurance protects your business from financial loss incurred through a customer’s non-payment or insolvency. It can also cover disputed debts and losses caused by political events around the world.
Credit insurance is available across all trade sectors and typically pays out 90% of lost revenue, provided you hold an insured limit from the underwriter. Options are available to cover one customer, all your customers, or any multiple inbetween.
- Lost revenue Typically pays out 90% of lost revenue, provided you hold an insured limit from the underwriter.
- Transfer risk Transfers the risk in your trade debtors to an insurer.
- Trade types Credit insurance is available across all trade sectors.
- Single or multi-use Options available to cover one customer, multiple customers, and all customers.
Why use credit insurance?
Credit insurance helps add discipline, structure, and control to your credit management process. Here are some of the key benefits of having credit insurance in place:
- Exporting Your export customer’s financial strength may be difficult to ascertain and fully understand, making credit assessment difficult. Whereas credit insurers hold huge databases of this information for risk assessment purposes.
- Working capital You may use an overdraft to buy in goods before supplying them to your customers. If the customer doesn’t pay, the lost revenue may affect your future working capital and your ability to pay your suppliers.
- Growth Often means accepting more risk by offering higher credit limits to customers whose financial strength you may not fully understand.
- Cash on delivery Insist on upfront payment and you may lose the customer by not offering credit terms. Credit insurance can help you work out to which customers you can safely offer credit and how much, helping your business grow with less risk.
- Credit reports While you can rely on these from the likes of D&B, this type of information is often based on out of date financial information. Credit insurers have access to real time information to make fully informed decisions for you.
- Risk assessment Assessing a customer’s balance sheet and profit & loss account to make a credit limit decision is a specialist skill which is done for you with a credit insurance policy.
- Monitoring risk Assessing a customer’s balance sheet and profit & loss account to make a credit limit decision is a specialist skill which is done for you with a credit insurance policy.
- Brexit Some economists are now predicting a 15% increase in company insolvencies during the next three years. Retail, construction, and metal sectors are considered highly vulnerable.
Downloads
Download the latest version of our credit insurance leaflet
FAQs
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No. Credit insurance is not legally required – but it makes business sense as approx. 30% of all business assets are tied up in credit.
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Credit insurance protects your company against the failure of your customers to pay trade credit debts owed to you. These debts can arise following a customer becoming insolvent or failing to pay within the agreed terms and conditions. You can find out more of what credit insurance is and why you would need it in our latest article
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There is no difference between credit insurance and trade credit insurance because they are the same thing, just named differently.
A few different terminologies exist for this insurance product such as: trade credit insurance, business credit insurance, export credit insurance, or credit insurance. These are all an insurance policy to protect business accounts from loss due to credit risks such as protracted default, insolvency, or bankruptcy.
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Related products
Whole-Turnover Insurance
A large number of credit insurance policies are written on this basis, particularly in the SME and mid-market arenas. This means you provide the insurer with a forecast of your annual turnover but you can exclude customers where you get paid before the goods are despatched or the customer is not a credit risk such as government bodies.
Bonds & Surety Guarantees
The purpose of a bond is to help the client meet the extra expenses to remedy the default and/or complete the contract. There are several types of bond that Alan Boswell Group can arrange.
Specific Account Insurance
This type of policy is suitable for a company that has a large or excessive exposure to a single company or group of companies. Specific account cover is protection that looks after one-off larger contracts, or the debt owed by one of a company’s largest customers.
Agricultural & Horticultural Credit Insurance Scheme
Credit insurance will protect against the insolvency of/refusal to pay by your customers. Our scheme policy is aimed at companies in the agricultural and horticultural industries, including those trading in fresh produce, herbs, flowers, dairy products, and livestock, among others.
Invoice Discounting
Invoice discounting is a type of cash flow finance, releasing cash against a company’s sales ledger.
Cash Flow Finance
Cash is king for any business, regardless of its size. However, trading on credit terms and the ongoing troubles with late payment can lead to cash flow challenges and restrict the potential of even the most profitable of businesses.
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