Overview

Selling your products and services on open credit terms often helps you gain a competitive edge. However, it can also expose you to your customers’ financial difficulties. Your business incurs credit risk every time you extend credit to your customers. Accounts Receivable is one of the most liquid and valuable assets a corporation has yet they are one of the most unprotected asset classes.  

Whether you sell within your town or around the world, credit insurance helps ensure that you will be paid for merchandise or services delivered to your customers. A trade credit insurance policy is a guarantee that you will be paid, subject to the terms and conditions of the policy, for the merchandise shipped or services rendered to your customer. By assuring payment, credit insurance can strengthen your company’s balance sheet and enhance your borrowing power, helping you grow your business and offering you piece of mind.

Trade Credit Insurance protects against:

  • Unforeseen credit loss(es) in accounts receivable
  • Insolvency (Chapter 7 or 11 or international equivalent)
  • Protracted Default (slow pay delinquency)
  • Political Risks (Govenment Moratorium, Contract Frustration, Discharge of Debt, War, Transfer, Public Buyer Default)

As a leading insurance brokerage, HUB has strong relationships with all of the top rated Credit Insurance carriers in North America as well as access to carriers overseas. We will assist in establishing the structure that is consistent with your needs and requirements for protecting your domestic and export accounts receivable. With this protection in place, you can be assured that your accounts receivable sold on open credit terms will be paid, either by the debtor or the trade credit insurer within the terms and conditions of the policy. 

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FAQS

What does trade credit insurance cover?

Trade credit insurance covers the unpaid credit balance from merchandise shipped or services rendered to your customers in the event they cannot pay due to insolvency. Past due or slow paying accounts may also be included in policies. Political risk exposure, currency inconvertibility and contract cancellation may also be covered.

How does the policy work?

Because each business is unique, a HUB specialist will work with you and the insurance carrier to customize the policy to your particular needs. As your business grows, HUB will work with you to adapt your policy accordingly. For example, you can add new customers or make changes to existing coverage.

Why should I Insure my receivables?

Credit insurance can protect you against severe credit losses, which result in reduced working capital and an erosion of profits. Just as you ensure your property, your inventory and your employees, it is wise to insure all of your assets against severe loss. Insuring receivables allows you access to additional working capital, usually at better rates.