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What is trade credit insurance?Trade credit insurance provides your business with protection against the failure of a customer to pay their trade credit debts. This can arise as a result of your customer becoming insolvent. These risks are referred to as 'commercial risks'. The protection covers as standard goods or services sold and delivered, but can be tailored to cover many other risks such as work in progress and binding contracts.
How does trade credit insurance differ from credit information and factoring?- Trade credit insurance is different from credit information in that:
Its opinions are backed by insurance. Information agencies do not typically offer risk transfer.
Much of the information gathered by Euler Hermes Trade Credit comes from Euler Hermes's own intelligence gathering. This often makes it much more up-to-date than published information which can be over 12 months old.
- Trade credit insurance provides risk transfer, backed up by comprehensive information and analysis. Factoring provides cash acceleration. Similar products include discounting and receivables purchasing.
Who uses trade credit insurance? Companies of all sizes use trade credit insurance. Euler Hermes Trade Credit has solutions which suit the needs of the smallest SME up to the largest multi national company.
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