Understanding Trade Credit Insurance Companies

Trade credit insurance companies are specialized insurers that help businesses manage the risk of non-payment by their customers. They offer financial protection against bad debts, allowing companies to focus on growth and expansion.

These insurers typically cover a wide range of industries, including manufacturing, construction, and services. This is because trade credit insurance is often essential for businesses in these sectors to operate.

Trade credit insurance companies usually offer customized policies that fit the specific needs of each business. This may involve assessing the creditworthiness of a company's customers and providing coverage for a certain percentage of sales.

In return for this protection, businesses typically pay a premium to the insurer. This premium is usually a percentage of the insured amount, and it can vary depending on the level of risk involved.

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Trade credit insurance offers protection against non-payment by customers due to insolvency, default, and country risk. This is a common concern for businesses that extend credit to their customers.

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Trade credit insurance can cover extended payment defaults, bad debts arising from customer insolvency, and political risk, including non-payment resulting from political or climate-related events. These risks can be costly and unpredictable.

Here are some of the specific risks that trade credit insurance can cover:

By protecting against these risks, trade credit insurance can help businesses grow safely and confidently extend credit to new customers.

Coface offers a range of trade credit insurance solutions to suit different business sizes and industries.

For small to medium-sized businesses, EasyLiner is an all-inclusive, 100% online credit insurance solution. TradeLiner is another option, offering a simple, flexible, and custom-built solution.

GlobaLiner is designed for multinational companies, providing bespoke credit insurance and dedicated teams to support their growth.

Single Risk insurance covers complex one-off or recurrent projects, protecting against political risk and payment default.

When evaluating insurance providers, consider their industry experience. A provider with extensive experience in your industry is more likely to understand its unique risks and challenges.

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Look for a provider with a strong financial foundation, as this will ensure they can settle claims promptly and reliably. Their financial strength will give you peace of mind and protect your business from unexpected financial burdens.

Assess the provider's policy terms carefully, as these will outline what is covered, what is excluded, and any conditions that may apply. A clear and comprehensive policy will help you understand your level of protection and make informed decisions.

Don't overlook the provider's premium rates, as these can vary significantly between providers. Be sure to compare rates from multiple providers to ensure you're getting the best value for your money.

A provider with a robust risk assessment process can offer more reliable protection against credit risks. This process will help identify potential credit risks and provide you with the tools to manage them effectively.

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Coface offers four main types of trade credit insurance: EasyLiner, TradeLiner, GlobaLiner, and Single Risk.

EasyLiner is a 100% online credit insurance specifically designed for SMEs and very small companies. It's a comprehensive solution that provides all-inclusive coverage.

TradeLiner, on the other hand, is a flexible and custom-built solution for SMEs and mid-caps. It's a simple and straightforward approach to credit insurance.

GlobaLiner is a bespoke credit insurance solution for global companies, offering dedicated teams to support their growth. This type of insurance is ideal for multinational companies with complex needs.

Single Risk provides insurance against political risk and payment default, covering one-off or recurrent projects.

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Credit Complete is a solution designed for companies with existing credit insurance policies that are falling short on certain customers. This means it's a complementary policy that works alongside your primary insurer's policy.

Credit Complete provides protection on a named customer basis, which is excess of the primary insurer. This ensures that you're covered for any gaps in protection.

A dedicated underwriter manages your policy from quotation through to claims and everything in between. This means you'll have a single point of contact for all your policy needs.

Here are some key benefits of Credit Complete:

Coface offers a range of credit insurance solutions to suit every business need.

Their EasyLiner policy is an all-inclusive, 100% online credit insurance option designed for SMEs and very small companies.

TradeLiner is a simple, flexible, and custom-built solution for SMEs and mid-caps that provides first-class protection.

GlobaLiner is a bespoke credit insurance policy with dedicated teams that support the growth of global companies.

Single Risk insurance covers complex one-off or recurrent projects against political risk and payment default.

With Coface, you have access to all the information and assessments you need to make informed credit decisions and offer competitive credit terms with confidence.

Their solutions give you the peace of mind to develop your business, minimizing risks and opening doors to new opportunities for growth.

Chubb's financial strength is the highest among all private market trade credit insurers, making it a reliable choice for businesses.

This financial strength is especially important to banks and other lenders, as it provides a secure form of collateral for receivables.

Chubb provides certainty of coverage for the period of the policy through non-cancellable credit and country limits.

This means that businesses can rely on Chubb to protect their trade credit, even in uncertain economic times.

Chubb offers local, regional or central service according to requirements, providing flexibility and convenience for its clients.

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Trade credit insurance companies play a vital role in a company's risk management strategy. They help businesses mitigate the risk of non-payment and insulate them from the potential financial impact of customer insolvency.

Trade credit insurance covers extended payment defaults, bad debts arising from customer insolvency, and political risk, including non-payment resulting from political or climate-related events.

Having a trade credit insurance policy provides valuable insights into the creditworthiness of existing and potential customers, helping businesses make informed credit decisions.

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Trade credit insurance is a powerful risk management tool that protects businesses from non-payment of commercial debt. It ensures that suppliers get paid for their goods and services, even if their customers default on payments.

Trade credit insurance covers extended payment defaults (late payments), bad debts arising from customer insolvency, and political risk, including non-payment resulting from political or climate-related events, currency restrictions, interruption of trade or expropriation.

Businesses can better control and leverage their accounts receivable when using trade credit insurance. Claim triggers include insolvency and slow payments for accounts that are past due their terms.

Non-cancellable comprehensive trade credit insurance coverage is available with a risk tenor of up to three years. This type of coverage provides protection for accounts receivable on a non-cancellable basis above a deductible.

Amynta TCPRS authority is $100,000,000 per obligor (and higher on select names) with tenor up to three years. This means that businesses can have confidence in their ability to get paid for their goods and services, even if their customers default on payments.

Here are some common coverages offered by trade credit insurance providers:

Political risks can be a major concern for businesses and individuals alike. This includes transfer risk, where political or economic events prevent or delay the transfer of payments.

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Transfer risk can be caused by a variety of factors, including government moratoriums, which are decisions made by governments that prevent the release of funds. Government moratoriums can be a significant risk, especially for businesses that rely on timely payments.

Contract frustration is another type of political risk, where a decision is made that prevents the performance of a contract. This can be due to changes in government policies or laws that affect the contract.

Civil turmoil, such as insurrection, war, and natural disasters, can also pose a significant risk to businesses and individuals. These events can disrupt the flow of payments and make it difficult to conduct business as usual.

Trade credit insurance companies work by covering a percentage of the invoice value in case the buyer fails to pay. This percentage can vary, but it's usually up to 90%.

To get started, you'll need to provide information about your company and clients to the insurer. They'll assess the financial health of your customers to draw up credit limits and commercial terms tailored to your needs.

The insurer will monitor your clients around the clock, adjusting the coverage as needed to ensure you're protected. If a covered loss occurs, the insurer will reimburse you for the covered amount.

Here are the key steps in the trade credit insurance process:

The premium you pay to the insurer is typically a percentage of your total sales or the total amount of coverage required. This premium is usually paid upfront or in installments.

Trade Credit Insurance provides financial protection against non-payment, allowing businesses to grow safely by extending credit to new customers with confidence.

Catastrophic risk protection is one of the key benefits of Trade Credit Insurance, preventing loss of assets and reducing risk of key account concentration.

TCI can also support credit risk evaluation, structure credit decision making, and gain leverage with problem accounts.

A business can file a claim with their Trade Credit Insurance provider when a buyer defaults on payment, and if approved, the insurer will pay the insured the covered percentage of the invoice value.

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The claim process and terms of payment can vary depending on the insurance provider and the specifics of the policy.

Here are some key benefits of Trade Credit Insurance:

By having Trade Credit Insurance, a business can reduce bad debt reserves, freeing up working capital and allowing for more active capital to be infused into the business.

TCI can also enhance a company's borrowing capacity as lenders are more likely to advance funds against insured receivables, improving a company's financial performance.

Amynta PR Solutions is headquartered in New York, NY, bringing together industry-leading risk management and underwriting expertise.

Their team delivers the highest levels of service to customers with consistent decisions, product flexibility, and tailored credit risk solutions.

Trade credit insurance companies typically target customers who value prudent credit risk management and want to support their decision-making processes. These customers are often medium to large-sized firms with dedicated credit functions.

Their annual revenues usually exceed $50,000,000. This indicates that they have a significant financial presence and can benefit from specialized credit risk management services.

The industries targeted by these companies include Technology, Manufacturing, Energy, Retail / Foodservice, Construction, and Metals.

Our company offers specialized insurance services designed for businesses with large exposures. We have two main product lines that cater to these needs.

The Named Customer product is designed for companies with a portfolio of customers that is heavily weighted towards a handful of large exposures. This product provides protection on a named customer basis.

Our 360 online portal makes it easy for clients to manage their policies. A dedicated underwriter with ample authority also handles the policy from quotation through to claims.

Our Singapore office is located at 138 Market Street, #12-01 CapitaGreen, Singapore 048946. You can reach us at +65 6398 8673.

The Single Customer product is designed for companies seeking protection against their largest single exposure. This product also provides protection on a named customer basis.

Both products offer flexible risk share options. This means clients can customize their insurance coverage to suit their specific needs.

Here are the key benefits of our Named Customer and Single Customer products:

Our target markets are carefully selected to ensure we're providing the best services to those who need them most. We focus on medium to large-sized firms with dedicated credit functions and annual revenues exceeding $50,000,000.

These businesses tend to have a deep understanding of the importance of prudent credit risk management. They're not looking to outsource their decision-making, but rather to support it with expert guidance.

Our corporate customers come from a variety of industries, including technology, manufacturing, energy, retail/foodservice, construction, and metals. These industries often require specialized knowledge and expertise in credit risk management.

Here are the specific industries we target:

Trade credit insurance companies offer a range of forms and applications to help businesses manage their credit risk.

Many trade credit insurance companies provide a standard form, which outlines the terms and conditions of the policy, including the coverage limits, deductibles, and exclusions.

Businesses can also choose from various applications, such as open account insurance, which covers sales on credit to multiple buyers, or single buyer insurance, which covers sales to a single buyer.

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Trade credit insurance companies often provide a risk assessment tool to help businesses evaluate the creditworthiness of their buyers.

This tool can help businesses identify potential risks and make informed decisions about extending credit to their customers.

Some trade credit insurance companies also offer a credit limit increase option, which allows businesses to increase their coverage limits as their sales grow.

This can be a useful feature for businesses that are expanding their operations and need to extend more credit to their buyers.