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Credit Insurance & Binding Contracts

By May 12, 2020 No Comments

Credit Insurance & Binding Contracts | Niche Trade Credit Brokers

Credit insurance makes sure your business is protected in the event a client is unable to pay any credit debts they may have. Credit insurance policies are flexible and can be tailored to the specific needs of your business. Your individual policy can be modified to cover risks such as binding contracts and work in progress. Credit insurance is recommended for businesses of any size to ensure their cash flow is protected and to reduce their credit risk exposure.

Not all insurers offer credit insurance for binding contracts so it is important to ask your insurance brokers this prior to finalising your insurance. With that being said, the insurance of binding contracts is becoming more widespread within the insurance industry. Once a binding contract is signed, the underwriter can no longer reduce or cancel the agreed coverage. Credit insurance for binding contracts covers the event that the debtor becomes insolvent before the delivery of goods or services. Credit insurance may be offered for such contracts even after the withdrawal of credit limits.

When negotiating your credit insurance contract, it is important to discuss and explain all goods and services your business offers. This allows the insurer to determine which areas of cover you may need and the period of time you require coverage for. Niche Trade Credit offers credit insurance which covers binding contracts, political risk, bad debts and more. To view our full range of services, click here.

Talk to our experts today to ensure your credit insurance policy suits the needs of your business.

Is Credit Insurance Right For Your Business?

Credit insurance is an incredibly important way to protect your business and its cash flow, ensuring you are able to continue trading as usual should a client default on a payment. Credit insurance allows you to protect your accounts receivable and reduce credit risk. Credit insurance can provide you with the peace of mind knowing that your business is protected against the unknown. If your client fails to pay on the specified terms, you will be able to recover the money you are owed, up to the limit specified in your individual policy. While trade credit insurance can be extremely valuable, it is not right for all businesses. Keep reading to find out which businesses may benefit from trade credit insurance.

High Credit Risk Customers
If your business regularly trades with customers who have a high credit risk, trade credit insurance will be incredibly beneficial. Trade credit insurance ensures your business is protected against protracted default and allows you to recover the amounts owing up to your policy limit.

Protecting Cash Flow & Working Capital
For most small to medium businesses, any disruption to your business can have adverse effects. Trade credit insurance allows your business to be protected from events such as a customer defaulting on a debt or a major client entering bankruptcy.

Trading With Political Risk
While trading with developing countries can be lucrative, there are high risks associated. Political turmoil, central banking issues and upheaval are all very real and serious threats which could affect your business. Trade credit insurance can protect your business from these risks and allow it to continue to trade within these profitable markets.

Niche Trade Credit provides high quality credit management services in Sydney and specialises in risk management for Australian exporters and other companies who trade internationally. With over 30 years experience, Niche Trade Credit is regarded as the most dynamic and trustworthy Specialist Credit Insurance Brokerage in Australia.

Talk to our experts today and let us help you protect your business and its cash flow with trade credit insurance and political risk insurance.

*DISCLAIMER: No person should rely on the contents of this publication without first obtaining advice from a qualified professional person. This publications sold on the terms and understanding that (1) the authors, consultants and editors are not responsible for the results of any actions taken on the basis of information in this publication, nor for any error in or omission from this publication; and (2) the publisher is not engaged in rendering legal, accounting, professional or other advice or services. The publisher, and the authors, consultants and editors, expressly disclaim all and any liability and responsibility to any person, whether a purchaser or reader of this publication or not, in respect of anything, and of the consequences of anything, done or omitted to be done by any such person in reliance, whether wholly or partially, upon the whole or any part of the contents of this publication. Without limiting the generality of the above, no author, consultant or editor shall have any responsibility for any act or omission of any other author, consultant or editor.

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