Trade Credit Insurance - Secure Your Cash Flow, Minimize Risk
Trade Credit Insurance - Secure Your Cash Flow, Minimize Risk
In today’s dynamic market environment, effective credit risk management is essential for ensuring your company’s financial stability. Trade credit insurance helps reduce financial exposure and strengthens your customer relationships by protecting your receivables in the event of non-payment.
It covers outstanding payments from goods delivered or services rendered—minimizing liquidity shortfalls and reducing the impact of customer defaults. Most policies also include credit checks and debt collection services to proactively manage your credit risk.
Trade credit insurance not only protects your cash flow, but also boosts your competitive position and supports sustainable business growth. It enables you to establish a professional receivables management strategy and shields your business from unexpected financial losses.
Our experts at Breffka & Hehnke are here to help you find the optimal trade credit insurance solution tailored to your company’s specific needs.
Trade Credit insurance—also known as credit insurance or accounts receivable insurance—protects businesses against financial losses caused by unpaid invoices.
This form of insurance is especially relevant in B2B transactions with payment terms ranging from 30 to 180 days, where a customer default can severely impact cash flow. It acts as a financial safety net, securing your domestic and international receivables and helping to maintain liquidity even in the event of non-payment.
The cost of trade credit insurance varies based on factors such as company size, industry sector, export share, and the credit risk profile of your customers. Premiums are typically calculated as a fraction (per mille) of annual turnover or outstanding receivables.
Key pricing factors include:
Trade credit insurance covers losses due to non-payment or payment delays
caused by your customers’ insolvency or default.
The insurance becomes active after a positive credit check. A credit limit is then assigned. In case of default, the insurer compensates the outstanding amount minus the agreed deductible.
Unternehmen jeder Größe, die auf Rechnung arbeiten und längere Zahlungsziele gewähren, profitieren von dieser Absicherung.
Companies of all sizes that operate on open account terms and offer extended payment deadlines benefit from this type of protection.
The premium depends on factors such as company turnover, industry, customer creditworthiness, and historical claims experience.
