TRADE CREDIT INSURANCE Our job is protection of Your business Trade - - PowerPoint PPT Presentation

Our job is protection of Your business… TRADE CREDIT INSURANCE Trade Credit

Trade credit is goods delivery, providing services or handling a customer’s production

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company (supplier) to another company (customer/buyer) without advanced or immediate payment upon goods receipt

What is trade credit?

NB!

• accounts receivable often exceed 30% of all company’s assets

Accounts receivable (A/R)

Trade credit insurance is a security tool protecting your business against losses resulting from non-payment of outstanding debts by customers allowing to start making payments at some specified time in the future (deferred payment)

What is credit insurance?

• about 80% of suppliers deal with late payment problems

Reasons for Non-payment / Insured Perils:

• long-standing history of late payments
• customer’s insolvency (bankruptcy)
• political risks (as an additional option for export operations)

NB!

• Increasing control over accounts receivable

professional evaluation of debtors’ creditworthiness

• Entering new markets and boosting sales

deferred payment is a strong competitive advantage

• Maintaining liquidity

avoiding cash deficiency risk and strengthening the current account balance

What are the benefits of credit insurance?

• After filing for a bankruptcy petition in the Unified State Register you will have 30 days to report your claims

NB!

• Additional information on buyers

The opportunity to monitor not only current buyers, but also to evaluate potential buyers, including foreign counter agents

• Reduction in debt management costs

decrease in the reserve amount for accounts receivable and bad debts

• Alternative to bank instruments

cost-saving method compared to bank guarantee, letter of credit, factoring

What are the benefits of credit insurance?

• in December 2013, the city of Detroit filed for bankruptcy with 18 billion $ debt

NB!

How does it work?

Insurance Coverage Model

Insurance coverage options

• when bankruptcy in Ukraine 8.6c. of 1USD debt is paid back vs 37.7c. in Asia and 71.9c. in Europe/USA

NB!

• whole turnover

All contractors are covered with deferred payments

• top account

Key buyers are covered (accounting for 70-80% of sales)

• excess of loss

Significant aggregate deductible

• Domestic and international shipment insurance
• Whole turnover or its portion coverage with deferred payment покрытие
• Commercial and political risks coverage
• Maximum credit limit is up to 135M UAH
• Maximum deferred payment period is up to 90 days
• Waiting period is standard 180 days
• Guaranteed payment is up to 85% of the debt amount
• Retroactive coverage option

Characteristics of insurance coverage

• statistically, large bankruptcies occur more often than natural disasters

NB!

• Organizing communication with the Credit Insurer
• Studying all the possibilities how to build the insurance protection
• Collecting information about your counterparties
• Providing consultations during the loss settlement procedure
• Analyzing your current trade credits insurance programs for free and giving

recommendations on the possible improvements

• in 2017, accounts receivable of Ukrainian companies amounted to 3.5 trillion UAH

Business Solutions – is the first insurance broker in Ukraine specializing in Credit Insurance

NB!

• 23 years on the insurance market
• UAH 616,4 M is the actual cash reserves as of 31.12.2017, that is +275%

excess of performance indicators

• 93,5 % a share reinsured in companies with А- (S&P and A.M.Best) or higher

rating under effective obligatory package reinsurance programs

• 295 834 agreements concluded, in 2017

Insurance company

INGO Ukraine – reliable insurance partner

Business Solutions We help business to make balanced decisions!

Your trade credit insurance manager Zhuliy Yaroslav mobile +38 073 722 8776 e-mail: credit@bs.in.ua Trade Credit