Running a business is difficult. Learning to protect yourself from liabilities and potential losses is one of the most difficult parts of running a company. However, it doesn’t have to be as complicated as people think! One of the best ways to protect yourself from bad debts and unpaid invoices is to get trade credit insurance! The benefits of trade credit insurance help ensure that you and your company will continue to thrive even if a client can’t pay their invoice on time. Here’s what you need to know!
What is trade credit insurance?
Trade credit insurance, also known as debtor insurance, export credit insurance, or accounts receivable insurance, is a tool for risk management that helps protect your company from bad debts. This type of insurance covers your accounts receivable and therefore helps to protect your business from any unpaid invoices caused by bankrupt customers, default accounts, etc.
Trade credit insurance is flexible coverage to help both your domestic and export customers.
Timely payments are crucial to the longevity of your business. If a client fails to pay, you shouldn’t have to deal with the consequences. Credit insurance helps protect your cash flow by allowing you to still get paid even if a client can’t make a payment. This works by insuring your company against non-payment so that every invoice is covered for the insurance year.
What are the benefits of trade credit insurance?
Businesses of all sizes utilize trade credit insurance to help protect their bottom line. Aside from security, there are many benefits to having credit insurance.
Relieve your cash flow
One of the biggest benefits of trade credit insurance is that it helps protect your cash flow. Unpaid debts can have dire consequences on your business, as that revenue is needed for day-to-day operations. Having this type of insurance in place helps ensure that you get paid on time by protecting you against bad debts and unpaid invoices. With credit insurance, you don’t have to worry about the “what ifs” of customer payments.
Grow your business
With trade credit insurance, you don’t have to operate on credit. That means you can expand your business without complications and reach out to new clients, especially in foreign markets.
Monitor your clients
Having a strong insurance policy means you can monitor your clients and see who may be experiencing payment difficulties. This offers early insight into which accounts may need special attention without having to deal with the high risk and financial losses.
Increase your capital
Since lenders don’t want to work with unsecured accounts, having credit insurance will increase your capital by letting lenders know that you have protection against your larger clients not paying. This will make them more likely to work with your and your business, thus opening up new opportunities for you.
How do I get trade credit insurance?
Getting credit insurance for your company is an excellent decision that will help protect you from potential complications down the road. With Coughlin Insurance you can easily find a credit insurance policy that works for you and your company. Get your free business insurance quote today to help find the policy that will protect you and your business against bad debts!
Need business insurance? We’ve got you covered!
At Coughlin Insurance Services, we believe that our customers should be valued and taken care of. We aim to provide quality service and meet the needs of our clients by providing businesses, including those in the food industry, with the insurance they need to protect their assets. If you’re a business looking for insurance, don’t hesitate to reach out for a free insurance quote today!