Chicken OR The Egg
Due to COVID, what is happening in the credit insurance world today is unprecedented. The major credit insurers in the USA have all gone to congress asking for claims assistance as they are still experiencing massive losses. Companies want policies to insure their receivables, but a lot of the carriers don’t want to offer coverage. If they do offer coverage, it could be 30-40% approvals. It’s sort of like the chicken or the egg scenario. Do I take a policy with partial coverage now, hoping to get full coverage when things stabilize in the future, OR do I completely forgo a policy and hope my customer pays me? How long will this last and how much of a loss could I stomach if I took a significant non-payment? This is the balancing act that companies are facing. If you took a large loss, would this impact your appetite for new business going forward? Could I structure a policy to only cover my largest exposures? How about a structured policy that only covers bankruptcies?
The good news is you have options and we can help. I’ve talked to so many companies that have never shopped their credit insurance policy. They purchased directly from one carrier and end up stuck with what they are offered. Only later did they learn that there were other carriers or that their coverage (compared to their peers) was inadequate at best. Given such uncertain times, businesses must have multiple options when looking into credit insurance. Even if you stayed with your current carrier, wouldn’t it make sense to benchmark your premium with the whole market? Atradius, Coface, Euler Hermes, AIG, Liberty, Chubb, FCIA…etc? If you purchased a policy, and then your limit is cancelled, do you get a refund? What if my claim isn’t paid?
Without a broker that understands credit insurance, you simply don’t have anywhere to turn.
Leykell Insurance is a specialist in credit insurance for fuel distributors. There is no charge to you for our services. We can get you credit insurance quotes from all the major carriers, explain the difference in each, train you on how to use the policy, and warn about triggers that could deny claims. If you have a current policy, let us work with you to appeal coverage decisions, find excess coverage, work to lower or keep your costs down, and make sure your company is following all the necessary policy procedures.
Credit insurance is a cost-effective sales tool that allows you to insure your receivables so you can safely sell more to your existing customers, go after new customers that may have been a credit risk in the past, and expand into new markets that you originally perceived to be too risky. Credit insurance offers a cost-effective solution for safe and profitable growth:
- Grow sales safely, domestically and abroad, to new and existing customers
- Protect your business from risk of non-payments
- Make better and faster credit decisions
- Ease tensions between sales and credit
- Avoid personal guarantees
- Borrow better from the bank by eliminating concentrations and obtain higher advances with lower rates
- Eliminate letters of credit and replace them with a tax-deductible insurance provision
- Gives you leverage to collect from your customers
Contact me below and let’s discuss your options.