Credit Insurance: Why An Insurance Broker Can Help Your Business
Running a business means that your livelihood depends on your clients paying you for your hard work and valuable time. That is why it is important to ensure that you are not at risk of being left with unpaid invoices that may undermine the stability of your business. That’s why getting a credit insurance policy though an insurance broker can help your business. Our insurance broker team at LHK Group In Dublin and Drogheda will ensure that you have bad debt recovery.
- Are you a B2B company selling your goods and services on credit terms?
- Would you like advice on how to maximize new business opportunities, but in a low-risk manner?
- Would you like more information about your existing customers, and potential new businesses customers?
- Would you like to do this with a trusted partner who can advise you and work with a range of business partners to offer you advice?
If the answer is yes to any of these questions, speak to one of our experienced insurance brokers at LHK Group today to discuss credit insurance.
What is Credit Insurance?
Providing goods and services on credit is an essential and inherent part of doing business. But it doesn’t come without risk. What if your client defaults on payment or becomes insolvent before you’ve been paid? Up to 40% of a company’s assets can be tied up in trade debt and you need to consider if the risk involved merits taking on additional protection. Trading without credit insurance is like riding a bike with no helmet, you’re just trusting that you won’t hit a snag on the road, and if you do, it won’t be fatal.
A credit insurance policy is a cost-effective and efficient way to minimize this risk, because when the worst should happen and non-payment occurs, – credit insurance will reimburse up to 95% of the cash and help secure the future of your company.
In addition to covering you for any losses, it will also provide ongoing risk reviews of your customers, so that you can make better choices in relation to how and who you do business with. Most credit insurers also provide debt collection services as a standard offering on policies. This can add huge value and help you get paid quicker and improve cash flow.
Credit insurance allows businesses to forge ahead with the confidence to take on new commercial opportunities and new customers, knowing they are protected, should non-payment occur. That’s why you should get a credit insurance policy through an insurance broker. This can be very comforting, especially if you are thinking about exporting, or want to continue that exporting journey with your customers. You now have the security of a credit insurance policy, knowing you are protected if the worst should happen.
Who is Credit Insurance for?
Credit insurance is suitable for almost any company providing goods or services on credit to other companies. It is used by various companies, across many sectors, – from SMEs, right up to large multinationals. It’s used for both domestic and export trade.
How does it work?
- Review customer credit limit requirements and get a credit limit approval from insurers. This is the amount the insurer will agree to indemnify should your customer fail to pay.
- Insurers will keep you informed of any changes or amendments to credit limits if the financial health of your customer either improves or disimproves, or there are changes in the economic environment
- Trade away as per normal with your customers. Monitor customer due dates and report any over-dues to the insurance company within the specified time frame.
- New customers can be added to the policy at any stage.
- If your customer fails to pay, inform the insurer, and receive claim payment once all policy conditions have been met.
What are the benefits of an insurance broker?
Peace of mind:
Trade debt can account for up to 40% of a company’s assets. Having credit insurance in place allows you to chill and sleep comfortably at night knowing you are protected should the worst happen.
Access to up-to-date financial information:
Allowing you to make better, informed decisions about your customers and prospects.
Better overall credit management:
Improved focus and discipline from the start of your business relationship, giving you greater control over your credit management procedures.
Improved cash flow:
Improve cash flow by collecting money quicker, and replacing money lost through bad debts with your insurance policy.
Easier access to banks and other funders:
Lending institutions are more likely to extend loans if they know their money is protected.
Grow and expand your business:
Enter new markets and take on new customers with confidence by getting a credit insurance policy through an insurance broker.
The larger your customer base and the more products or services you sell, the higher the risk that you face on a day-to-day basis from trade credit. So to prevent risk, protect cash flow, develop your business and maintain positive supplier relationships, protect your company with credit insurance.
Please contact Sinead Wolfe to discuss your credit insurance needs. Sinead can offer expert advice in relation to Credit Insurance, having worked in this space for the last 14 years with one of Irelands leading Credit Insurance providers. Whether you have a credit insurance policy in place currently and would like to review it to ensure you are getting the best cover and price she can talk to you about this. Or alternatively, if you would like to discuss the benefits and options of having such a policy in place please email or contact Sinead directly.
Sinead’s approach is about offering advice and best practice guidance on all the aspects of the credit management process including credit risk analysis, credit management best practices and debt collection. If you would like to discuss the benefits of a credit insurance policy or attain a quote for your business, please contact .
In addition to the Credit insurance, our experienced team can arrange cover for you across the following products: Home insurance, Car insurance, Gadget insurance, Marine insurance, Personal accident insurance, Self-build insurance, Travel insurance, Commercial legal expenses, Commercial liability insurance, Commercial motor insurance, Commercial property insurance, Contractors all risk insurance, Cyber insurance, Directors and officers insurance, Engineering insurance, Farm insurance, Group personal accident insurance, Marine cargo/ goods in transit insurance, Motor fleet insurance, Motor traders insurance, Office insurance, Professional indemnity insurance, Shop and retail insurance and Special types vehicles insurance.
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