Insurance of receivables
The insurance of invoices with deferred payment dates is just one element of risk management. The main aim of such insurance is to protect the Insured from lack of payment from their buyers.
Trade credit insurance provides protection in case of:
- Legally established insolvency (legal events including liquidation bankruptcy, bankruptcy with composition agreement, sanctioning proceedings, bailiff’s decision on ineffective execution;
- Delinquency (so-called protracted default) in the payment of obligations (the debtor conducts business, but does not pay his obligations);
- The buyer is from countries with higher economic and/or political risk.
Additional benefits of having accounts receivables insurance are:
- risk monitoring carried out by specialists;
- collection of receivables within the insurance contract;
- information about different risks;