For certain types of credit insurance, such as our SME solution Simplicity , you pay a fixed premium, depending on your turnover. For most policies, the premium is calculated as a percentage of your turnover. In addition, you pay a limit fee for each limit you apply for. Usually the percentage is less than 0.5% of your company's turnover. The following factors determine the premium:
- Turnover of your company;
- Spread of the risk, as the number of debtors or the distribution over different countries for example;
- The industry to which your company and customers belong;
- Agreed delivery terms and payment terms;
- The additional risk covered, such as political risk and contract or manufacturing risk;
- Agreed percentage of cover in the credit insurance policy.
Uncollectible receivables and dubious trade debits on the balance sheet on average amount to about 0.7% of the total turnover. A credit insurance policy is therefore very cost-effective, on top of all the other benefits.