Credit Insurance: As the pound decreases the exporting increases?
As everyone knows the British Pound has weakened against most currencies across the world since the EU referendum. This would seem a good time to export goods and services as foreign companies will be able to take advantage of their stronger currency and get a more competitive price from the UK. Would you be willing to start exporting and to take on new markets to increase your turnover? Maybe it's a bit risky, but credit insurance is here to help curb that fear of risk.
Why credit insurance?
A credit insurance policy protects your company from its debtors failing to pay you, whether that is due to defaulting on payment because of a cash flow issue, or by going into administration. If one of your debtors files for administration, you would normally have to wait for the administrator to liquidate their assets, decide if a dividend for the unsecured creditors is to be paid (quite often 1p for every pound owed if any at all) and then wait for the cheques to be issued and sent out. This can often take years to decide! Not to mention laws are different in other countries so it could take longer. With a credit insurance policy a claim process will begin as soon as the company has entered administration and you will be paid out up to 90% of what you were owed once the claim has been processed. Another possible claim scenario would be if the company fails to pay within 6 months after the due date of the invoice. Credit insurance offer many benefits.
Key points about credit insurance
- Based on a standard UK £1,000,000 turnover you could pay about £3,600 for a credit insurance policy which compared to a car insurance policy of say £500 for a £15,000 car, it is relatively cheap!
- Credit insurance protects what is often a company's largest asset.
- Up to date information on your clients at your fingertips - credit insurers have improved insight on many companies across the world.
- Credit insurance improves your cash-flow as it promotes improved credit control.
- Debt collection fees covered under your credit insurance policy.
The CMR difference
At CMR, we pride ourselves on our friendly approach and knowledge of our managed credit insurance policy that we provide. The fact that we manage the credit insurance policy for you gives you the time to grow your company all whilst having the peace of mind that you are insured when bad debts occur.
If you would like further information regarding credit insurance do not hesitate to get in contact with us or request a quick quote now.