Credit Insurance

Credit Insurance covers the risk of non-payment by a buyer. It protects businesses against losses from credit sales, ensuring payment for goods or services even if the buyer defaults.

Credit insurance policies apply to both domestic and international trade. Underwriters assess the creditworthiness of buyers before issuing policies. Businesses can claim compensation if a buyer fails to pay due to insolvency, protracted default, or political risks.

Examples include Euler Hermes, Atradius, and Coface. These providers offer policies tailored to specific industries, such as manufacturing, retail, and services.

Credit insurance enables companies to extend credit to new customers confidently. It also facilitates better cash flow management and financial planning. Businesses often use it alongside accounts receivable management strategies.