What is Credit Insurance? Credit Insurance protects your business against the risk of bad debts, caused by either insolvency or protracted non-payment. Credit Insurance can also: Protect your business against the unseen and provides a firm foundation for growth. Provide access to unique financial information on existing and new customers. Provide sophisticated worldwide debt and legal collection services. Credit Insurance enables management to concentrate on developing secure and profitable business so that you can trade confidently in a risky market environment. Credit Insurance is available for both your domestic and export customers and cover can be tailored to meet your needs so that you can avoid the potentially disastrous effects of bad debt losses. Types of Credit Insurance Policies that are available: Whole Turnover Domestic Credit Insurance Policy This type of Credit Insurance policy is designed to cover your entire turnover with customers in the UK against insolvency and default. Policies are usually structured with an excess of £500-£1,000 and many underwriters are now offering fixed premiums inclusive of credit limit charges as well as an integral collections facility. Whole Turnover Export Credit Insurance Policy As per the Whole Turnover Domestic Credit Insurance Policy, but designed to cover your entire export turnover. Combined Domestic & Export Credit Insurance Policy As per the Whole Turnover Domestic Credit Insurance Policy, but designed to cover a combination of domestic and export sales. Specific Account Credit Insurance Policy A policy designed to cover a single customer, which in many cases, is the largest account on the ledger. Most policies cover insolvency only and an "indemnity" is applied to the credit limit granted, usually 80-90%. This type of Credit Insurance policy is not designed to cover a customer where there is perceived to be a higher than average risk. Key Account Credit Insurance Policy This type of Credit Insurance policy covers a selection of between 2 and 20 of your customers, usually the largest accounts on the ledger. These policies usually cover both insolvency and protracted default and an excess would apply. Catastrophe Credit Insurance Policy This type of Credit Insurance policy is designed to suit companies with turnover in excess of £10 million with effective and sophisticated credit control procedures. On this basis, the insurer "underwrites" the credit control procedures and sets an Annual Aggregate Deductible, in excess of which, claims are payable. The deductible is usually set at a level of at least £25,000 and more commonly at £50,000-£100,000 . Global Credit Insurance Policy This type of Credit Insurance policy would suit a multinational company, with trading centres in several countries. A single policy would be structured to cover all the divisions or branches on either a Whole Turnover or Catastrophe basis, depending on the individual requirements. Bonds and Guarantees: Bonds and guarantees are written promises, provided by a Surety or Guarantor, to pay for direct loss and damage by a third party, the beneficiary of the bond. They are issued to provide the beneficiary with protection against breach of contractual obligations by the Surety or Guarantor's client. In many instances the Surety or Guarantor will retain the right to mitigate the loss or, in some instances, arrange for the completion of the contract. Performance bonds guarantee that the contractor will perform the contact in accordance with the terms and conditions of the written contract. Bonds and Guarantees can facilitate financial transactions, such as the sale of a business and ensure that obligations are performed in a timely manner. There are many types of bond and guarantees available, for virtually all scenarios, subject to the underlying security and risk being acceptable to the Surety or Guarantor, some of the more common types are: Performance bonds Construction bonds VAT and Duty Deferment Bonds Deferred Payment Guarantees Advanced Payment Bonds Why Pegasus Funding Resources? Pegasus Funding Resources has an extensive panel of direct insurers and specialist brokers available to them. Our services to you are Free of Charge so let us find the best insurance policy or bond that suits your requirements while you spend time increasing your profits. Download our Credit Insurance Datasheet Please contact your nearest Pegasus Funding Resources Associate in your area, all contact details are on the contact page.
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