Trade Credit Insurance
HUB International is a leading North American insurance brokerage with offices throughout Canada and the United States. Our reputation in the industry is built on the unparalleled service, coverage and value we provide our clients. We understand our clients’ businesses and are market leaders in placement experience. With the expertise and depth to ensure that you have the right solution at every stage of your business, Our Knowledge becomes Your Advantage.
Protecting your business and – in particular your opportunities for growth -- is a fundamental tenet of our HUB International Trade Credit Insurance specialty practice.
Recognizing that the sale of your products and services on open credit terms often helps you gain a competitive edge, it can also expose you to the potential financial difficulties faced by your own customers. The problem is that your business incurs credit risk every time you extend credit to your customers.
Although Accounts Receivable are among the most liquid and valuable assets a corporation has, they are also typically one of the most unprotected asset classes.
Whether you sell within your own city, province, across Canada or even around the world, Trade Credit Insurance helps ensure that you will be paid for merchandise or services delivered to your customers.
A HUB International Trade Credit Insurance policy is a guarantee that you will be paid, subject to the terms and conditions of the policy, for the merchandise shipped or services rendered to your customer. That’s only part of the upside and benefits of having Trade Credit Insurance in place. By assuring payment, credit insurance can strengthen your company’s balance sheet and enhance your borrowing power, helping you grow your business – not to mention offering you piece of mind.
Risks covered by Trade Credit Insurance
HUB International Trade Credit Insurance protects against:
- Unforeseen credit loss(es) in accounts receivable;
- Client/Customer Insolvency (Chapter 7 or 11 or international equivalent);
- Protracted Default (slow pay delinquency);
- Political Risks (Government Moratorium, Contract Frustration, Discharge of Debt, War, Transfer, Public Buyer Default)
Trade Credit Insurance 101
Your HUB International Trade Credit Insurance specialist can ensure that you have a solid understanding of how these policies can help secure growth for your business. Here are some of the most common questions we get from business leaders such as yourself when it comes to Trade Credit Insurance and why it’s become increasingly important as a best practice in protecting your Accounts Receivable and your business.
What does trade credit insurance cover?
Trade credit insurance covers the unpaid credit balance from merchandise shipped or services rendered to your customers in the event they cannot pay due to insolvency. Past due or slow paying accounts may also be included in policies. Political risk exposure, currency inconvertibility and contract cancellation may also be covered.
How does the policy work?
Because each business is unique, a HUB International specialist will work with you and the insurance carrier to customize the policy to your particular needs. As your business grows, HUB International will work with you to adapt your policy accordingly. For example, you can add new customers or make changes to existing coverage.
Why should we insure our receivables?
Credit insurance can protect you against severe credit losses, which result in reduced working capital and an erosion of profits. Just as you ensure your property, your inventory and your employees, it is wise to insure all of your assets against severe loss. Insuring receivables allows you access to additional working capital, usually at better rates.
Your Advantage: Our Global Resources
We pride ourselves in our vast global resources and solid local relationships, including with the best providers in the insurance business. As a leading insurance brokerage, HUB International has strong relationships with all of the top rated Credit Insurance carriers in North America as well as access to carriers overseas. We will assist in establishing the structure that is consistent with your needs and requirements for protecting your domestic and export accounts receivable. With this protection in place, you can be assured that accounts receivable sold on open credit terms will be paid, either by the debtor or the trade credit insurer, within the terms and conditions of the policy.
Working as part of our HUB International Professional & Financial Risk practice, our team of Trade Credit Insurance specialists has access to the best coverages in related areas such as General Liability, Cyber Liability, D&O (Directors & Officers Liability) and Employment Practices Liability insurance.
Paired with Property and Worker's Compensation Insurance, General Liability insurance is essential for businesses. A general liability insurance policy can protect your business from lawsuits resulting from a range of injuries and damage.
Coverage to protect businesses against exposures to loss created by the use of the Internet in everyday business.
Directors & Officers
Protects directors and officers of public, private and non-for-profit corporations against loss (damages and cost of defense) arising out of their status or conduct as directors or officers. Common claims allege breach of duty, and security law violations.
Employment Practices Liability
Protects companies and individuals against loss (damages and defense costs) arising out of employment practice disputes. Common claims allege discrimination, sexual harassment, wrongful termination and wrongful discipline.
More information on each of these related coverages is available elsewhere herein at www.HUBprofessional.ca (see Financial Risk and the menu of insurance options in which our team at HUB International provides, with the best coverage, value and service).