Trade credit insurance
Whole turnover cover
The most common form of credit insurance covers your entire customer base. This will normally incorporate a low excess with up to 90% indemnity, providing maximum scope of cover.
Normally a limit of discretion is introduced, allowing you to trade with smaller customers without reference to the insurer, providing credit can be supported with satisfactory trading history or a status report from an approved agency. Many insurers now offer fixed premiums, which are inclusive of all limit charges as well as an integral collections service. Whole turnover policies can be written on the following basis:
- domestic
- export incorporating political risk
- domestic & export incorporating political risk
Specific account cover
Provides cover against the failure of a single customer. Normally for the largest customer on the ledger, it can provide up to 100% cover with no excess. Cover is available on an annual basis, or for the duration of the contract.
Key account cover
For your company's largest customers, covering 2 to 40 names on the ledger. It can provide up to 100% indemnity, although, a pre-determined excess would normally apply. Generally insolvency and protracted default are covered.
Excess of loss/catastrophe cover
Specifically designed for companies with turnovers in excess of £10 million, who can afford to sustain a level of debt themselves on a ‘risk sharing’ basis and a pre-determined annual aggregate deductible. Cover can be on an ‘all vetting’ basis, or, if credit control procedures are sophisticated enough, cover is justified on the basis of the company’s own credit control manual and procedures.
This policy can attract up to 100% indemnity but would also be subject to a small individual excess.
Group & global cover
A single policy for group or multinational companies to cover all their subsidiaries or branches both in the UK and overseas. Any policy can be structured to suit the company’s needs either on a whole turnover or on an excess of loss basis.
