The Client Account is the only account not covered in your balance sheet. Are your customers going to pay you? Are they going to be bankrupt? There could be a host of reasons for non-payment, and the loss of a large payment may spell disaster for your business, whatever the prudence and competence exercised. On the other hand, too cautious an attitude in evaluating risk and selecting buyers may result in loss of hard-to-get business opportunities.
To this Question, Following is the Answer:
Business Credit Shield is an insurance policy and risk management product offerred by The New India Assurance Company Limited, that covers the risk of default by buyers following delivery of goods or services. Risk covered under this Policy are Protracted Default, Insolvency or Bankruptcy and Political Risk (only under Export Policy).
Advantages of Credit Insurance:
Business Credit Insurance offers following advantages to every business:
1. Increased Market Share: With Business Credit Insurance you are able to offer attractive credit terms to your Buyers, which helps you gain more market share.
2. Better Information about your Buyers: Dynamic Credit Analysis of your Buyers allows NIA to keep you informed about Financial Health of your buyers to ensure that you can limit your exposure on those buyers. In case we fail to do that, even then with your risk insured with us, you will remain comfortable.
3. Improved Balance Sheet: With better recovery chances from defaulting buyers, you bad debt will start falling down, which will surely give a better look to your balance sheet. You may also reduce your provision for Bad Debt once you have this cover with you.
4. This Cover Pays for Itself: With Business Credit Insurance on your side, you may increase your turnover significantly by offerring better credit terms to your Buyers. The additional profit generated by a modest increase of 20% in your turnover will be sufficient to pay premium for your Credit Insurance Premium.
What you get and what you don't?
This is what you get:
The claim is paid in one of these cases:
1. Declared Insolvency of your buyer
2. Protracted Default
3.Political Risks (For Exports only)
This is what is generally not covered:
1.Disputed debts.
2. Default of your agents / employees.
3. Dishonesty and fraud.
4. Disregard of agreed credit management procedures.
5. Sales made to subsidiaries /associates/public/govt. bodies.
6. Claims in excess of discretionary/sanctioned credit limits.
Interested?
Please contact us today using Contact Form, or by telephone.
