Credit insurance

 There are many types of credit insurance offered today, which are usually further tailored to the specific security needs of a business.

1. Whole Turnover cover (the most common solution) - This comprehensive policy will cover the whole business. The credit insurance policy allows the business to offer credit up to a certain amount: anything above this figure must be agreed in advance by the insurance company. The premium paid is based on the turnover of the business.

2. Critical customer cover - This credit insurance policy allows a business to have insurance cover against a number of named customers (usually up to 10). Such customers may be under threat from insolvency, have a poor credit rating, or may be key customers. The business will be fully responsible for the remaining customers not covered by the credit insurance.

3. Specific risk cover - This credit insurance policy allows a business to have insurance against any single customer or a large contract. The premium paid is based on the contract value or the turnover of the customer over the policy period.

4. Export credit insurance - If a business trades outside the UK, this policy can offer insurance against non-payment of overseas customers. This type of policy can also insure against a number of risks including political issues, currency issues and dis-honoured letters of credit.

 

Custom Search