We know what you’re all thinking, it’s just another company saying they’re better than their competitors and they will promise you the world. However this is not the case. We would just like to enlighten you as to how a credit insurance policy can help reduce the risk of a bad debt destabilising your business. Great timing following a report by Direct Line for Business that suggested £5.8billion was written off in the last financial year by SMEs (small to medium enterprises)…that’s correct, that’s not even all businesses!
The facts and figures
In the survey when asked how much money their business had written off in unpaid debts, around one in five SMEs said that they had written off an estimated average of £31,330. However, almost one in ten of these SMEs claimed to have written off debts in excess of £100,000. Of this, 29% was due to customer insolvency and 17% was written off as they didn’t feel their customer would be able to pay. That means a huge amount of what was written off potentially would have been covered under a credit insurance policy.
What Direct Line for Business said:
Nick Breton, Head of Direct Line for Business said: “With more than a million SMEs based across the UK, these enterprises really do make up the backbone of the British economy. However, it is alarming to see just how much hard work goes unrewarded, especially when considering that many SMEs appear reluctant to chase debts, with reasons ranging from thinking that the client may not be able to afford the cost to damaging their relationship.
“All of these debts add up and with nearly 7,000 companies estimated to have entered liquidation in the first half of 2016 alone, the potentially disastrous knock-on effects of writing off monies owed are clear.”
What we have to say about that
Our managed credit insurance policy should not be seen as an additional insurance that you need but as an arm to your company that helps with your credit control, debt recovery and ultimately protects you from bad debt. How does this work I hear you say? Well, we will check the creditworthiness of your customers to begin with, and as a credit insurance policy requires you to notify overdue accounts, this in turn helps improve your credit control as you’re more on top of your debtors. Plus we provide you with credit control advice and if payment is still not forthcoming the credit insurance policy covers the cost of the debt recovery service that we provide. Finally if your customer is still not paying you or has become insolvent, we proceed with collating and processing your claim and if you have ever had a claim before you’ll understand our expertise will save you a lot of your time.
For your no obligation free consultation, please give us a call on 0208 835 2587 or request a call back here.