Credit Insurance, also known as Bad Debt Protection, is a type of insurance that protects businesses that sell goods and services to other businesses on credit terms from the risk of non-payment. Many multi-national companies use insurance coverage from companies like Niche Trade Credit Insurance - credit insurance company for various reasons, such as getting the better working capital loans to use on growing their business, expand credit department’s resources, and of course, to request for credit. In short, credit companies allow businesses to compete against bigger competition through deeper pockets, with a larger safety net for risks.
Is credit insurance suitable for every business company?
For companies that obtain payments in advance or on delivery from their unique products, then there’s obviously no need for credit insurance. However, most businesses, if not all, don’t get this luxury. When doing business in a competitive environment, getting the help of credit insurance as well as their favorable credit terms can definitely help any business company, especially in their daily operations.
How much does this type of insurance cost?
As with other types of insurance, the cost obviously depends on the degree of risk. The insurance company will conduct its risk assessment and consider all risks involved for the credit sales you forecast for a specified period of time (usually one year), the businesses and countries you do business with and sell your products (or services), value of credit sales in the past years, associated loss (if any), and excess level you are willing to accept. Check out NicheTC
How to get a quote?
Companies like Niche Trade Credit Insurance – credit insurance company have brokers who are always willing to assist you. Usually, you only need to complete a brief questionnaire, and they will approach the market on your behalf. Brokers can help you get the best policy structure that fits the needs of your business, for the price you can afford.
Who will pay the broker?
You don’t need to pay the broker, as the insurance provider will pay their brokers themselves through commission-based reward.
For companies that export, can they get cover for export sales?
Yes, export coverage is one of the biggest advantages of bad debt protection. As a matter of fact, many insurance providers include many different countries in their coverage. However, there are some countries where risks are too great and coverage is not available. Read more at http://www.nichetc.com.au/
How can businesses make sure their claims will be paid by the credit company?
Well, many companies such as Niche Trade Credit Insurance – credit insurance company provide step-by-step guide to help businesses on their claims easily.
Of course, there are also reasons why businesses can’t get their claims. Here are five of these most common reasons.
1. The client/business company failed to pay the premium, which is a condition required for the insurance.
2. The client/business company did not submit an invoice within the first 30 days of sending the products.
3. The client/business company has insufficient or doesn’t have enough credit limit to cover the loss.
4. The client/business company doesn’t have title retention clause in the contract.
5. The client/business company failed to report overdue accounts to the provider within the agreed timeframe.