Trade Credit Insurance is an effective financial risk management tool that secures your company against losses arising from non-payment of trade invoices.
What is the purpose of credit insurance?
Credit insurance guarantees a lender will be repaid if a borrower is unable to pay his or her debt due to, for example, death or disability. Although credit insurance is solely for the benefit of the lender, it is purchased and paid for by the borrower.
Type of risk covered under credit insurance
Credit insurance covers 2 types of risks – commercial and political risks. Commercial Risks: Insolvency of the buyer. Non-payment by the buyer.