Credit insurance protects your company against payment defaults that may arise from its customers. Such insurance covers receivables from customers that cannot be settled for various reasons.
Reasons for a payment default could be, for example, insolvency, inability to pay or even late payment. Through credit insurance, companies are able to protect their receivables from customers and secure their liquidity.
As a rule, the insurance company also handles receivables management and credit checks on potential customers.
Typical examples of damage
Typical examples of losses result from payment defaults caused by insolvency, inability to pay or even late payment by customers.
In this context, small and medium-sized enterprises in particular are often affected by payment defaults, which can significantly jeopardize their liquidity.
If a major customer does not pay its invoices or pays them only after a very long delay, the company may run into difficulties in paying suppliers or wages.
Credit insurance can minimize such risks and stabilize your business.
Credit insurance can be beneficial for businesses of any size and in any industry. Companies that operate in the B2B sector and do business with a large number of customers should consider credit insurance. Companies that operate in high-risk industries, such as construction or textiles, can use credit insurance to protect their receivables from customers and secure important liquidity in the event of non-payment.
Companies that operate internationally or work with international customers can use credit insurance to check the creditworthiness of potential customers abroad and protect themselves against possible risks arising from different legal systems and currencies.
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