Protect your debtors from insolvency and late payments with Trade Credit Insurance
Morgan Insurance Brokers has access to industry leading Trade Credit Insurers. We get to know your business, your industry, your risk, and your clients. We can provide tailored cover to protect your biggest asset; your income!
Reach out today.
Trade Credit Insurance Broker
Protect your debtors from insolvency and late payments with Trade Credit Insurance
Morgan Insurance Brokers has access to industry leading Trade Credit Insurers. We get to know your business, your industry, your risk, and your clients. We can provide tailored cover to protect your biggest asset; your income!
Reach out today.
THE BENEFITS OF TRADE CREDIT INSURANCE
If you have any queries or apprehensions about trade credit insurance, we are at your service. Our team of specialists can guide you through the process. We take pride in providing tailored assistance to ensure you move forward with confidence. Do not hesitate to contact us for personalised support. We are committed to offering you the guidance and support necessary to navigate the complex terrain of trade credit insurance.
What is Trade Credit Insurance?
Trade Credit Insurance is important for businesse as it protects from the financial burden if a customer is unable to pay.
It can provide benefits such as:
- Cover against Insolvency
- Cover for slow payments/failure to pay
- Provide insights on your customers ability to pay, before you deal with them.
What Industries Benefit the most?
- Construction
- Food
- Export
- Wholesale
- Transport
The Stats
In 2022 there were 4,912 insolvencies in Australia where a company enters external administration or had a controlled appointed. 61.4% of these were voluntary liquidation.
The Construction Industry lead the way with 1,284 insolvencies.
NSW had the greatest rate of insolvencies – 1,903. Victoria had 1,307 and QLD just behind with 952 for the year ending 2022.
Get a free quote!
THE PROCESS
1.
INFORMATION GATHERING______________________
Contact Morgan Insurance Brokers. We will ask you a series of questions about your business, and will need the names of who you want covered, your projected Turnover, the industry you’re in and a copy of your Aged Receivables/Debtors
2.
RESEARCH________
Let Morgan Insurance Brokers discuss with a panel of specialist insurers about the risk levels of your current clients and future clients and then get pricing.
3.
NEGOTIATION____________
Discuss pricing and negotiate terms of cover to get you the right cover at the right cost.
4.
GET COVERED!___________
Get Insured and trade knowing you’re in great hands with information about your clients financial position, before it happens!
Your Trade Credit Insurance Questions Answered
Morgan Insurance Brokers has access to the major Insurance Providers to the Australian Market.
CoFace, Atradius, QBE, The Bond and Credit Co, Euler Hermes. We are also a Prasidium Partner.
The cost of trade credit insurance in Australia varies widely depending on several factors:
- The size/turnover of your business;
- Your business activities/industry;
- Level of cover you choose;
- The insurer that you insure with;
- Your clients insolvency history.
To get an accurate quote for Trade Credit Insurance in contact Morgan Insurance Brokers.
If you are dealing on credit terms with your customers or suppliers and require a line of credit with your bank or lender, they may request that you insure for Trade Credit Insurance. This mitigates not only your risk, but the banks financial risk as well in the event that your customers go insolvent.
Fortunately, we provide a holistic approach to Insurance and can provide cover for all or your business insurance needs. From, Public Liability Insurance, Business Insurance, to Commercial Motor & Fleet Insurances.
Protracted default means that your waiting period of non-payment by your client has been met and you can claim for the unpaid invoices.
With cash on delivery terms there is not a risk a non-payment and is excluded under a Trade Credit Insurance Policy. Ensure that your terms do not stad COD if you are providing your services or goods on credit terms.
Works with the Government – state, local or federal, local councils, or private individuals are excluded.
Contact Morgan Insurance Brokers and we will liaise with your insurer to get cover reviewed and approved.
A Discretionary Trading Limit is a pre-approved limit that is provided to you by your insurer at the start of the policy. It will allow you to trade with smaller customers without the need for a credit check with your insurer.
What are the conditions of trading under a Discretionary Limit?
These limits are small, ($25,000) and rely on you doing your due diligence on your customer. In most cases you will need to order a credit report and it will need to return no adverse information.
No, GST amounts are excluded from your claim settlements.
Each insurer will have a date agreed in which you will need to notify of non-payments. Failure to do so could mean that you jeopardise your cover under the policy.
No, disputes are excluded under all Trade Credit Insurance Policies. Disputes will need rectified before cover can be considered.
You can insure for a single customer or project. However, it is more cost effective to insure all of your customers and turnover.
A Credit Limit is an amount that your insurer is willing to cover your customer in the event of non payment or insolvency.
How do I calculate what my Credit Limit should be?
A Credit Limit is calculated by what your credit terms with your customer is. For example, if you have 60 day credit terms with your clients, you would apply for the highest amount that you would have oustanding with your clients for that 60 day period.
How does the insurer assess my request for a credit limit application?
Your credit limit application is determined by your insurer based on their credit report, industry insights in their ability to pay, their industry, and how long they’ve been trading.
Trade credit insurance is primarily designed to protect businesses from the risk of non-payment for goods or services they have provided. It is not limited to international trade activities only. While it may be particularly important for businesses involved in exporting or importing, it is equally valuable for companies that operate solely within their home markets.
If one of your customers is unable to pay due to insolvency or by default as per the insurers policy definition, then your insurer investigates the claim and if it’s approved, pays out the oustanding amount up to the insured percentage, less GST.
