Can I Insure My Accounts Receivable?

You can insure your accounts receivable with trade credit insurance. This protects your cash flow by compensating you for unpaid invoices.

Depending on your policy, credit insurance usually covers:

  • Customer bankruptcy
  • Political risks that may impact your customers’ ability to pay
  • Refusal or inability of your customer to pay within the terms of your contract

Benefits of accounts receivable insurance

Insuring your accounts receivable is good business practice. It forms the central core of strong credit risk management strategies performed by all sizes of business, from SMEs to multinationals. The benefits of accounts receivable insurance – also known as trade credit insurance and debtor insurance – include:

 

Protecting your business from the bad debts of others

Whether through insolvency, default, or political risks, your customer may fail to pay you.
Credit insurance means that, no matter what (in line with the wording of your policy), you still get paid.  No matter how long you have known your buyer you don’t always know what is impacting their business.

Exploring new markets and growing your business

Credit insurance is used by many businesses to enable trade.
It can be particularly useful when exploring new markets as most credit insurance companies will conduct their own research into your prospective customers, adding another layer to your own due diligence.
The expertise and knowledge of underwriters working in your sector can also further support your understanding of a potential market and underpin your decision-making processes.

Improving your access to finance

Banks tend to be risk averse. Credit insurance can help you demonstrate your bottom line is secure and can, therefore, enhance your negotiations with finance providers.

 

How to find the right accounts receivable insurance for your business

Trade credit insurance is designed to protect the accounts receivables of all sizes of business.
No matter whether you’re responsible for the accounts of an SME, a national business that trades solely within the U.S., or a multinational trading worldwide, there will be a solution that is ideal for your business and its needs.

Learn more about trade credit insurance.

Learn how insuring your accounts receivable can form part of a strong credit risk management strategy

Find out about Atradius credit insurance solutions 

 

Disclaimer:
The statements made herein are provided solely for general informational purposes and should not be relied upon for any purpose. Please refer to the actual policy or the relevant product or services agreement for the governing terms. Nothing herein should be construed to create any right, obligation or responsibility on the part of Atradius, including any obligation to conduct due diligence of buyers or on your behalf. If Atradius does conduct due diligence on any buyer it is for its own underwriting purposes and not for the benefit of the insured or any other person.
Additionally, in no event shall Atradius and its related, affiliated and subsidiary companies be liable for any direct, indirect, special, incidental, or consequential damages arising out of the use of the statements made information herein.

Related content

What is Trade Credit Insurance?

Trade credit insurance protects your business from bad debts.

How Much Does Trade Credit Insurance Cost?

Your insurer will assess the risk based on trading history, your customer ratings, credit terms, loss history, business sector, customer location.

What Is Business Debt Recovery?

Business debt recovery is the process of chasing businesses to pay back money they owe.

Disclaimer

The statements made herein are provided solely for general informational purposes and should not be relied upon for any purpose. Please refer to the actual policy or the relevant product or services agreement for the governing terms. Nothing herein should be construed to create any right, obligation, advice or responsibility on the part of Atradius, including any obligation to conduct due diligence of buyers or on your behalf. If Atradius does conduct due diligence on any buyer it is for its own underwriting purposes and not for the benefit of the insured or any other person. Additionally, in no event shall Atradius and its related, affiliated and subsidiary companies be liable for any direct, indirect, special, incidental, or consequential damages arising out of the use of the statements made information herein.