Trade Credit Insurance Claims Procedure
There's no denying making an insurance claim can be time consuming as you must complete forms, collate paperwork and then wait for the insurer to review it all. At CMR, our managed trade credit insurance policy aids with the whole process of a claim, making policyholders' lives much easier. Most businesses have likely not ever had to make a trade credit insurance claim. Let us talk you through the process that protects from bad debts destabilising businesses.
What's first?
Once you have a trade credit insurance policy in place you will be informed of your Maximum Extension Period (MEP). The MEP is the point at which the insurer needs to be notified that an overdue account could result in a claim. The MEP is added to the due date of the first invoice that is overdue. For example, if your policy states your MEP is 45 days and you have an invoice that is due on 31st March. This must be notified to the insurer if payment is not received by the 15th of May. During this time, CMR offers our debt recovery specialists to prevent the claims procedure from taking place, however this is not always the case.
Claim
In the event of a bad debt, the claims procedure will be initiated straight away. CMR will start organising what is needed to prevent any issues during the process. If notified of your customer's insolvency, you should send CMR any information the insolvency practitioner has sent to you. This could be a letter explaining what has happened and a proof of debt form, which will need completing to confirm what you are owed. Once the claim is ready to be processed, CMR will collate and send the insurer the following:
- Copy orders
- Copy Invoices
- Evidence of delivery/service
- Current Statement of Account
- Trading History - to make sure the policy hasn't been breached
- Evidence of discretionary limit (if applicable) - a copy of a credit report from the last 12 months or trading history to substantiate cover
- Terms & Conditions
- Insolvency paperwork
- Proof of Debt Form / Letter to lodge debt
- Confirmation of debt form completed by the insolvency practitioner
- Confirmation supplier ranked as a creditor
- Written confirmation of the ROT (Retention of Title) position (if applicable)
As you can see there is plenty of information needed to support a claim. This is where CMR becomes invaluable to its clients. We guide policyholders through the maze and then submit the claims for them. This process saves time and speeds up the process meaning a claim is paid promptly. We will continue to monitor the claim and deal with any queries that may arise.
All in all, CMR has been trading for over 28 years because we provide a service that supports a business' growth and make lives easier and mitigates risk. Should you wish to find out how CMR can help in other ways please do not hesitate to get in touch.
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