Is your business ready to handle bad debt? Is your cash flow protected when your clients or customers fail to make the payments on time? If not, then you should work towards getting credit insurance for your company right now.
No matter how many checks you put in place if your business runs on using credit facilities for payments from your customers, you are always vulnerable to facing bad debts which can at times result in complete business failure. Many start-ups fail because of this reason. They have amazing ideas, their operations run on time, but they do not know how to tackle bad debts and keep a steady cash flow for the continuous running of their business.
Credit insurance Australia from Niche Trade Credit based in Gordon, NSW can help you in protecting your business from risks associated with insolvency because your client has not made timely payments and has failed to abide by the credit terms. Your credit insurance policy will pay a percentage of your invoice under such conditions. This keeps your business running by ensuring that there is a constant cash flow to meet the needs of your company’s operations daily.
Can trade credit insurance help in settling unpaid invoices?
When you are dealing with unpaid invoices, most business owners do not have the skills to recover the bills from their customers. Taking credit insurance along with debt collection service gives the responsibility to your insurance agency for collection of debt from your customers and even renegotiating any terms if required.
Under circumstances such as the bankruptcy of your client, your insurance cover will pay back your debt after deducting the cover charges which is approximately 10% of the total invoice amount. So, you get paid irrespective of the situation.
Advantages of buying credit insurance covers for businesses
Protects your trade:
- It can be used on both domestic and foreign trades.
- Foreign trades with new customers involve high risk and should always be covered by credit insurance to protect businesses from facing huge debts.
Gives you more freedom for exploring new markets and gaining a new customer base:
- With less risk at hand, most business owners feel more confident at expanding their current reach.
Keeps your cash flow in control:
- With a safe working capital in hand, you will never run out of business.
- This also helps you in building better client relationships and you can easily provide them with more options on credit terms.
Enhance your relationships:
- Debt collectors are more apt at communicating with customers who are unable to clear their payments.
- This will enhance your relationship with such customers for future dealings.
- Also, with secured finances, you can enjoy better relationships with your bank as well.
Depending upon your business profile and level of risk involved, you can decide the cost requirement of the credit insurance. This is why it is important to talk to the insurance agency and let them know your requirement so that they can create a tailor-made credit insurance policy for protecting your business.